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Author: 


Title: 


Sixth  and  Eighth  avenue 
surface  railroads  in  the... 

Place: 

[New  York] 

Date: 

[1897?] 


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MASTER    NEGATIVE   # 


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Sixth  and  Eighth  avenue  surface  railroads  in  the 
city  of  New  York;  the  city's  interest,  facts. 
[New  York,  1897?3 
55  p*   22^  c^* 

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LIBRARY 


School  of  Business 


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■  "f ^;^5«;--#'«sa 


SIXTH  AND  EIGHTH  AVENUE  SURFACE    RAIL- 
ROADS IN  THE  CITY  OF  NEW  YORK. 


THE  CITY'S  INTEREST. 


FACTS 


REWOPtm  CLUB, 

Committee  on 

MUNICIPAL  ADMINISTRATION. 


f 


/^ 


INDEX. 


Page. 

Preface 3 

Offers  for  the  Road§ 4 

Bill§  authorizing^  City  to  acquire  Roadi 15 

The  Purchase  of  the  Road§  urged 17 

Position  of  Corporation  Counsel 17 

"           "  CityCiub 18 

"           ^'  Board  of  Aldermen 21 

4(           a  Workingnien 22 

"           ''  Board  of  Trade 23 

Suit  broujg^ht  by  a  Taxpayer' 24 

Attitude  of  the  Press 25 

Position  of  The  Sun 25 

"           "  Tiie  Tribune 27 

"           "  The  Press 2§ 

"           ^^  The  Hail  and  Express 30 

Value  of  these  Franchises 35 

EiCtter  of  John  Harsen  Rhoades 35 

Views  of  a  Prominent  Lawyer 40 

Views  of  a  Citizen 44 

.i        i(,    xhe  Railroad  Commission 49 

Position  of  the  ]?Ietropolitan  Company 51 

The  City's  Options  still  in  Force 53 

-^*>  L  I  b  K  A  K    V    -^-^ 
OF  THB 

REFORM  CLUB,  NEW   YORK. 
CITY  AFFAIRS  COMMirTEE. 


3  540 


■ — .lo 


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PREFACE. 


The  matter  of  the  reclaiming  and  sale  by  the  city 
of  the  valuable  franchises  of  the  Sixth  and  Eighth 
avenue  railroad  companies  has  been  before  the  gen- 
eral public  only  a  few  weeks  and  already  the  dis- 
cussion called  forth  ;  the  action  of  the  City  Club, 
the  Board  of  Trade,  tlie  laboring  men,  the  Corpor- 
ation Counsel  and  the  Board  of  Aldermen  in  advo- 
cating that  the  city  purchase  the  franchises,  or,  in 
the  alternative,  get  what  profit  it  can  from  the 
franchises  ;  and  the  favor  and  earnestness  with 
which  these  ideas  have  been  received  and  advocated 
by  the  daily  press,  all  attest  the  awakening  of  the 
public  to  its  interests  in  these  franchises. 

Whatever  practical  difficulties,  if  any,  may  stand 
in  the  way  of  the  city's  exercising  its  option  at  the 
present  time,  there  is  a  strong  sentiment  that  such 
action  should  be  taken  at  once  as  will  protect  the 
rights  of  the  city  in  its  option  ;  leaving  to  the  future 
the  matter  of  raising  the  necessary  funds. 

In  the  following  pages  will  be  found  a  compre- 
hensive statement  of  the  present  status  of  the  mat- 
ter, with  the  reasons  for  and  against  the  city's 
acquiring  these  franchi^,es,  the  views  of  the  press 
and  of  the  public,  and  the  action  of  the  various 
authorities  and  organizations. 


i' 


/ 


THE    OFFERS    MADE    TO    THE    CITY 

FOR  THE   ROADS. 

Following  the  offer  of  the  Third  Avenue  Railroad 
Company  (for  terms,  see  ''Sun''  editorial,  p.  25, 
post),  came  Mr.  Braker's  bid.     His  offer  is  : 

*'  Office  of  H.  J.  Braker  &  Bro., 

95  William  Street, 

New  York  City,  April  7,  1897. 

To  the  Mayor,  Aldermen  and  Commonalty  of  the 

City  of  New  York, 
To  the  Comptroller  of  the  City  of  New  York, 
To  the  Commissioners  of  the  Sinking  Fund  of  the 

City  of  New  York. 

Gentlemen. — An  examination  of  the  public 
records  of  this  city  shows  that  the  city  is  in  a  posi- 
tion to  dispose  of  two  valuable  street  car  fran- 
chises, to  wit,  those  now  being  operated  by  tlie 
Metropolitan  Street  Railway  Company,  and  known, 
respectivel}',  as  the  "Eighth  Avenue  Railroad" 
and  '*  Sixth  Avenue  Railroad"  (the  latter  includ- 
ing the  road  operated  on  Lenox  avenue  above  Cen- 
tral Park).  Both  of  these  franchises  were  granted 
by  the  Common  Council  in  September,  1851,  sub- 
ject to  the  express  condition  as  to  the  Eighth 
avenue  road  that  no  motive  power  excepting  horses 
should  be  used  below  Fifty-lirst  street,  and  as  to  the 
Sfxth  avenue  road  that  no  motive  power  excepting 
horses  should  be  used  below  Forty-second  street, 
and  as  to  both  roads  that  the  licensees  and  grantees 
should  surrender,  convey  and  transfer  the  said 
roads,  respectively,  to  the  Corporation  of  the  City 
of  New  York  whenever  required  so  to  do  on  pay- 
ment by  the  Corporation  of  the  cost  of  said  road 
with  ten  per  cent,  advance  thereon. 

While  up  to  the  present  time  it  may  not  have 
been  incumbent  upon  the  city  officials  to  take  any  ac- 
tion in  regard  to  these  franchises  as  the  successors  in 
interest  of  the  original  parties  have  been  operating 
them  practically  in  accordance  with  the  respective 


charters,  it  seems  proper  at  this  time  that  the  city 
should  exercise  its  right  of  re-entry  as  the  parties 
in  interest  have  given  notice  that  they  intend  to  act 
independently  of  the  franchises,  and,  in  direct  vio- 
lation of  their  conditions,  intend  to  change  the  mo- 
tive power  from  that  to  which  the  franchises  ex- 
pressly limit  them. 

The  initiative,  therefore,  having  come  from  those 
parties  themselves,  there  can  be  no  adverse  criti- 
cism if  the  city  shall  step  in  at  this  time  and  exer- 
cise the  rights  which,  by  the  wisdom  and  fore- 
thought of  the  members  oi  the  Common  Council  of 
1851,  were  wisely  x^reserved. 

Hr.  Braker'§  Offer. 

I  offer  and  am  prepared  to  pay  the  sum  of  one 
million  dollars  for  each  of  the  above-mentioned 
franchises  (taking  either  or  both),  to  be  paid  in 
cash  on  receipt  of  the  proper  resolutions,  and  I 
also  agree  to  convey  such  franchises  or  have  them 
delivered  direct,  as  the  Corporation  Counsel  shall 
advise,  to  a  railroad  corporation  to  be  organized 
so  as  to  comply  with  the  law^  in  that  respect,  the 
incorporation  whereof  shall  be  approved  by  such 
Corporation  Counsel,  and  I  agree  to  accept,  or  canse 
to  be  so  accepted,  such  franchises,  or  either  of  them, 
subject  to  conditions  as  follows  : 

Terms  of  Offer. 

1.  That  in  addition  to  such  sum  of  one  million 
dollars  for  each  franchise,  I  will  pay  all  sums  which 
the  city  of  New^  York  will  be  required  to  pay  to 
the  owners  of  such  roads  and  franchises,  represent- 
ing the  cost  of  construction,  and  ten  per  cent,  ad- 
ditional, as  required  by  said  contract  of  September, 
1851. 

2.  (Annual  income  to  city.)  That  in  addition  to 
such  sums  representing  the  purchase  price,  there 
shall  be  paid,  as  provided  by  law^,  to  the  city  of 
New  York,  an  annual  charge  equal  to  three  per 
cent,  of  the  gross  proceeds  for  the  Jirst  live  years 
and  five  per  cent,  thereafter,  but  such  sum  in  no 
year  to  be  less  than  fifty  thousand  dollars  on  each 
road. 


6 


3.  That  the  motive  power  used  shall  be  approved 
by  the  proper  officers  of  the  city  of  JN'ew  York  and 
the  Board  of  Railroad  Commissioners  of  the  State 
of  New  York,  and  siiall  exclude  steam  power. 

4.  (Transfers.)  That  such  franchises  sliall  be 
subject  to  such  provisions  as  shall  be  established 
by  the  city  of  New  York  and  the  said  Board  of 
Railroad  Commissioners  as  to  exchange  of  pas- 
sengers with  any  and  all  connecting  street  surface 
railways,  it  being  my  intention  that  the  said  roads 
shall  accept  tiansfers  from  all  connecting  roads 
and  to  give  transfers  to  all  which  will  accept  them. 

I  also  agree  that  if  such  franchises,  or  either  of 
them,  are  delivered  to  me,  or  such  corporation 
organized  by  me,  that  I  will  properly  indemnify 
the  city  of  New  York  against  any  loss  or  damage 
by  reason  of  its  action  in  so  doing,  and  that  such 
indemnity  shall  be  in  the  form  and  manner  to  be 
approved  by  the  Corporation  Counsel  in  the  sum 
of  at  least  $50,000  :  and  I  further  agree  that  if  at 
any  time  it  shall  be  adjudged  that  the  city  of  New^ 
York  w^as  not  authorized  to  deliver  such  franchises* 
that  neither  myself  nor  my  assigns  shall  have  any 
claim  or  make  any  demand  for  damages  by  reason 
thereof. 

In  making  this  proposition  and  requesting  these 
franchises  1  have  endeavored  to  put  a  fair  and 
proper  value  upon  them  and  to  suggest  limitations 
and  conditions  that  will  be  satisfactory  to  the  city 
and  advantageous  to  the  public,  and  in  case  any 
question  shall  arise  as  to  whether  such  franchises 
should  be  sold  at  auction  I  am  prepared  to  bid  the 
above  amounts  on  the  above  conditions,  and  if  the 
proper  officers  of  the  city  will  advertise  the  same 
I  will  forthwith  enter  into  a  bond  of  $50,000  tliat  I 
will  bid  the  above  amounts  on  the  sales  theieof. 

Trusting  that  my  request  will  receive  your  favor- 
able consideration,  I  am 

Yours  very  respectfully, 

H.  J.  Brakek." 


Who  Mr.  Brakcr  ■§. 

The  Commercial  Advertiser  of  April  17th,  says 
of  Mr.  Braker : 

''The  moving  spirit  in  the  enterprise  is  Henry 
J.  Braker,  a  multimillionaire.  Mr.*  Braker  is  the 
type  of  progressive  manhood  characteristic  of 
America.  Although  only  forty-five  years,  he  is 
the  director  of  three  gigantic  enterprises,  the  con- 
trol of  any  one  of  which  would  satisfy  the  ambi- 
tion of  an  average  industrious  man.  Although 
not  a  conspicuous  figure  in  the  news  or  the  talk  of 
the  day,  he  practically  has  a  monopoly  of  the 
camphor  trade  of  the  United  States.  His  firm  is 
the  largest  of  drug  importers,  and  he  is  one  of  the 
foremost  dealers  in  fertilizers  in  the  country.  Not 
content  with  these  financial  ahd  commercial  tri- 
umphs, he  has  entered  the  arena  of  street  railroad- 
ing, and  his  past  successes  would  seem  to  indicate 
that  he  will  cut  no  mean  figure  in  the  new  branch 
of  industry  in  which  he  has  chosen  to  engage." 


The  World  of  April  8th  says  : 

"There  is  every  reason  to  believe  that  Mr. 
Braker  means  business.  He  is  a  man  of  large 
wealth,  and  as  senior  member  of  the  firm  of  H.  J. 
Braker  &  Brother,  drug  importers  at  No.  95  Wil- 
liam street,  is  widely  known  and  respected  in  com- 
mercial circles.  *  *  ^  ^ "  Mr.  Braker  has 
large  street  railway  interests  in  other  cities. 


With  Mr.  Braker' s  offer  to  the  City  was  sent  the 
following  letter  as  a  guarantee  of  JMr.  Braker^ s 
responsibility. 

Fidelity  and  Deposit  Company  of  Maryland, 

33  Wall  Street, 

New  York,  April  7,  1897. 
TotJie  Mayor^  Aldermen  and  Commonalty  of  the 

City  of  New  York. 
To  the  Comptroller  of  the  City  of  New  York. 
To  the  Commissioners  of  the  Sinking  Fund 

of  the  City  of  New  York. 
Gentlemen.— IlIyi^  is  to  advise  you  that  we  are 


8 


prepared  forthwith  to  execute  for  H.  J.  Braker, 
either  or  both  of  the  bonds  of  $50,000  each  referred 
to  in  his  communication  of  this  date  to  you  in 
regard  to  the  purchase  of  the  franchise  of  the  rail- 
roads of  the  Sixth  and  Eighth  Avenue  Companies. 

Yours  truly, 

Fidelity  &  Deposit  Company  of  Maryland. 

H.  P.  Platt, 

Vice-President. 


m 


IStatcnieiit  by  €liarle§  Henry  Butler,  Attorney  for 
Mr.  Braker,  of  reasons  wliy  the  otter  should  be 
accepted. 

7o  tlie  Mayor  Aldermen  and  Commonalty  of  the 
City  of  Neio  York. 

To  the  Comptroller  of  the  City  of  Beio  York. 

To  the  Commissioners  of  the  Sinking  Fund  of  the 
City  of  Neio  York. 

''Gentlemen.— In  submitting  to  you,  on  behalf 
of  my  client,  Henry  J.  Braker,  a  proposition  to 
purchase  the  franchises  for  the  street  surface  rail- 
roads, generally  known  as  the  Sixth  and  Eighth 
Avenue  Railroads,  permit  me  to  briefly  state  Mr. 
Braker' s  position,  and  the  grounds  for  his  believing 
that  it  would  not  only  be  eminently  proper,  but 
that  it  is  also  the  duty  of  the  proper  officers  of  this 
city  to  accept  his  offer,  unless  other  parties  are  wil- 
ling to  give  a  larger  sum,  in  which  case  it  would 
-certainly  be  the  duty  of  the  city  officials  to  expose 
the  franchises  for  sale,  and  so  realize  for  the  city 
their  actual  market  value." 


Why  mr.  Braker's  Otter  Should  be  Accepted. 

*'i^/r5^.— The  franchises  are  entirely  under   the 


9 


control  of  the  city,  and  the  parties  now  operating 
the  railroads  on  those  streets  and  avenues  at  the 
present  time  are  practically  only  tenants  at  \yill  for 
a  mere  nominal  rental  (as  to  keeping  certain  por- 
tions of  the  streets  in  order),  and  are  occupying  as 
as  it  were  the  premises  until  the  city  is  prepared 
to  re-enter  and  take  possession  under  the  existing 
contract,  and  then  to  realize  the  full  actual  value, 
which  was  evidently  the  intention  of  the  Common 
Council  of  1851. 

Second. — The  agreement  of  September,  1851, 
under  which  both  franchises  were  granted,  ex- 
pressly provided  that  at  any  time  the  city  could 
re-enter  and  re-posspss  itself  of  the  streets  free  and 
clear  of  the  tracks  on  payment  to  the  licensees  of 
the  cost  and  ten  per  cent,  in  addition. 

By  this  i^ro vision  tlie  parties  who  took  the  risk 
of  building  the  roads  were  fully  assured  against 
loss,  and  were  allowed  all  they  could  make  from 
year  to  year  so  long  as  the  city  permitted  them  to 
use  those  streets,  and  they  incurred  no  liability. 
Thus  it  was  a  perfectly  safe  bargain  for  them,  and 
it  will  be  no  hardship  on  them  or  their  successors 
whenever  the  city  should  exercise  the  right  which 
the  city  expressly  reserved  as  a  condition  for  grant- 
ing the  favorable  terms  of  the  charter. 

The  present  owners  having  acquired  the  roads 
with  full  knowledge  of  the  condition  of  the  fran- 
chise cannot  claim  that  the  city  should  not  exercise 
undoubted  right  to  re-enter,  as  that  was  one  of  the 
risks  which  they  assumed  when  they  acquired  the 
stock  of  the  comi)anies  operating  under  the  fran- 
chises. The  case  is  exactly  the  same  as  though  it 
affected  private  property,  and  can  be  compared  to 
what  is  happening  every  day  in  this  city. 

An  owner  of  a  block  of  property  uptown,  having 
no  present  use  therefor,  permits  a  vegetable  gard- 
ener to  occupy  it  on  a  monthly  lease,  at  a  nominal 
rental.  As  years  go  by,  the  land  becomes  enor- 
mously valuable,  but  still  the  owner  does  not  dis- 
turb his  tenant  until  at  last  the  time  comes  when 
the  land  is  either  sold  or  improved  ;  then  the  ow^ner 
must  necessarily  ask  the  tenant  to  vacate  the  prem- 
ises ;  meanwhile,  however,  the  tenant  has  sold  his 
business  to  another  gardener  w^ith   notice  of  the 


I 

1 


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nature  of  his  lease.  Can  that  tenant  complain? 
Will  any  one  say  that  simply  because  the  land  has 
been  so  profitable  during  these  years  ;  that  because 
the  rent  has  been  so  cheap,  when  rents  of  surround- 
ing property  were  so  high  ;  that  because  the  lot  of 
the  tenant  was  so  happy  that  the  landlord  who  had 
been  so  considerate  for  so  many  years  must  for  ever 
forego  the  full  use  of  his  property  ? 

Now,  that  is  exactly  the  position  taken  by  the 
present  owners  of  the  Sixth  and  Eighth  Avenue 
Railroads  For  years  they  have  enjoyed  without 
expense  the  right  to  operate  these  railroads  through 
the  most  thickly  populated  parts  of  the  city  of 
New  York  on  condition  that  they  would  surrender 
the  right  so  to  do  whenever  the  city  demanded 
possession  and  reimbursed  them  for  the  actual  cost 
and  ten  per  cent,  additional.  Having  taken  pos- 
session of  a  piece  of  property  subject  to  an  out- 
standing option,  they  certainly  cannot  complain  if 
the  holder  of  the  option  exercises  the  right  of  ac- 
quisition on  the  terms  of  which  they  had  due 
notice. 

Third.— This  is  the  proper  time  for  the  city  to 
exercise  its  riglit  under  the  contract  of  1851,  as  the 
licensees  have  themselves,  without  warrant  or  au- 
thority, attempted  to  exercise  rights  of  ownership 
entirely  inconsistent  with,  and,  in  fact,  in  direct 
violation  of  the  terms  of  the  existing  franchises, 
thus  showing  an  absolute  disregard  of  their  obli- 
gation to  the  city.  They  propose  at  this  time  to 
change  the  entire  nature  qf  the  franchises  and  to 
use  a  motive  power  expressly  prohibited  thereby 
and  subject  to  which  express  prohibition  the  fran- 
chises were  granted. 

The  initiative,  therefore,  having  come  from  the 
licensees  themselves  the  city  should  promptly  act 
upon  its  rights  and  prevent  any  possibility  of  a 
claim  being  made  that  by  any  acquiescence  as  to 
the  proposed  changes,  either  active  or  passive  on 
its  part,  it  has  in  any  way,  by  implication  or  estop- 
pel, w^aived  the  valuable  rights  reserved  in  the 
franchises. 

Fourth. — The  city  has  never  in  any  way  waived 
any  of  its  rights  under  the  contracts  of  1851,   and 


11 


a 


its  not  having  enforced  the  surrender  clause  up  to 
the  present  time  does  not  in  any  way  operate  as  a 
waiver  of  such  rights  whenever  it  shall  elect  to  ex- 
ercise them.  Up  to  the  present  time  it  has  not 
been  in  a  position  where  it  was  obliged  to  act  or 
lose  any  substantial  right.  The  franchises  have 
been  steadily  increasing  in  value  as  the  city  in- 
creased in  area  and  population,  and  the  city  could 
afford  to  wait  until  the  proper  time  before  electing 
to  avail  of  the  surrender  rights.  But  the  time  has 
now  arrived  when  it  cannot  afford  to  wait  any 
longer. 

1.  Because  the  value  is  now  fixed,  and  the 
amounts  offered  are  minimum  amounts  which  the 
city  is  sure  to  receive,  and  it  is  also  indemnified 
and  saved  harmless  from  all  expense,  liability  and 
damages,  and  the  city  is  now  in  a  position  wiiere, 
by  availing  of  its  plain  legal  rights,  it  can  receive 
for  franchise  property  which  is  proper  for  it  to 
sell  $2,000,000,  and  an  annual  income  of  at  least 
$100,000,  which  is  entirely  in  excess  of  the  amount 
now  received. 

2.  Because,  if  it  does  not  now  avail  of  its  con- 
tract rights  under  the  agreement  of  1851,  it  will 
probably  never  be  able  to  do  so  again.  If  the  mo- 
tive power  is  changed  under  color  of  law%  the  pro- 
posed expenditure  of  $8,(K)0,000  will  be  added  to 
the  cost,  and  10  percent,  in  addition  thereto  would 
amount  to  $300,000.  This  would  practically  nullify 
the  city's  rights,  as  while  it  would  be  feasible  (as 
has  actually  happened)  to  find  a  purchaser  at  an 
advance  of  a  million  dollars,  plus  the  cost  and  10 
per  cent,  of  the  present  road,  it  would  probably  be 
impracticable  to  find  a  purchaser,  after  the  im- 
provements have  been  made,  who  would  bid  the 
present  cost,  improvements  and  10  per  cent,  on  all 
expenditures,  in  which  event  the  city  would  lose 
the  benefit  of  a  million  dollars  and  hfty  thousand 
dollars  per  annum  on  each  franchise. 

Fifth.— The  advantages,  however,  that  will  ac- 
crue to  the  city  by  accepting  Mr.  Braker's  proposi- 
tion will  be  far  greater  than  those  alluded  to  which 
are  of  a  pecuniary  nature  oidy. 

It  is  as  much  the  duty  of  the  city  officials  to  pro- 


?li 


12 

tect  the  nghts  of  citizens  as  to  local  transportation 
as  It  IS  to  wisely  and  economically  administer  the 
city's  finances,  and  there  can  be  lio  doubt  that  the 
franchises  which  Mr.  Biaker  offers  to  accept  will 
greatly  increase  the  facilities  of  local  transporta- 
tion. At  present  there  are  bat  few  points  of  trans- 
ler  on  either  road.  No  transfers  are  given  to  or 
accepted  from  many  of  the  intersecting  and  con- 
necting street-surface  roads,  and  the  travelino- pub- 
lic are  compelled  to  pay  double  fares  from  points 
within  short  distances. 

At  the  present  moment  the  demand  is  essentiallv 
for  single  fares.  The  public  are  entitled  to  it. 
Street  railroad  companies  are  operated  on  fran- 
chises received  from  the  people,  and  the  people  are 
entitled  to  recognition,  and  sould  not  be  compelled 
to  pay  double  fare  because  it  so  happens  thai  dif- 
ferent and  competing  corporations  have  secured 
intersecting  lines. 

Mr.  Braker  meets  this  point  by  agreeing  that  the 
franchises  shall  be  subject  to  provisions  as  to 
transfers  that  will  compel  these  lines  to  accept 
transfers  from  and  give  transfers  to  all  connectino- 
and  intersecting  lines  on  such  terms  as  the  Common 
Council  and  Board  of  Railroad  Commissioners  shall 
determine.  The  fairness  of  this  proposition  and 
Its  advantage  to  the  traveling  public  are  too  appar- 
ent to  need  any  elaboration,  and  I  simply  wish  to 
add  that  the  clause  regarding  transfers  was  inserted 
in  the  proposition  as  it  is  now  evident  that  no  new 
franchises  either  should  be,  or  will  be  given  by 
the  i)ublic  authorities  unless  these  rights  of  the 
public  are  recognized  and  preserved. 

Sixth.— The  city  should  avail  of  Mr.  Braker's 
offer,  as  it  is  so  made  that  the  city  is  relieved  of 
all  responsibility  and  liability.  If  any  question  of 
liability  should  arise,  Mr.  Braker  will  be  obliged  to 
bear  the  expense,  and  the  city  will  be  amply  in- 
demnified  against  all  loss  ;  and,  on  the  other  hand, 
if  the  city  IS  justified  in  accepting  the  offer,  it  is  the 
gainer  by  $2,000,000,  besides  an  additional  annual 
income  of  at  least  $100,000  ;  that  is  to  say,  the  city 
has  a  fortune  to  gain  and  nothing  to  lose. 

Sevent/i. —The  offer  is  not  made  by  irresponsible 


13 


parties  or  for  the  purpose  of  preventing  the  present 
licensees  from  carrying  on  a  proposed  line  of  im- 
provements. It  is  made  by  a  responsible  citizen, 
who  is  amply  able  to  carry  out  the  terms  of  any 
contract  which  the  city  may  make  with  him,  and 
who  tenders  the  highest  class  of  security  in  sub- 
stantial amount  that  he  will  fulfill  the  contract  if  it 
is  made.  Under  such  circumstance  I  hardly  think 
that  his  offer  should  be,  or  will  be,  refused. 

The  city  can  enforce  its  contracts  with  the  com- 
panies. 

EigMh. — As  to  the  legal  aspects  of  the  j^roposi- 
tion,  I  have  not  entered  into  them  at  this  time,  as 
it  has  been  my  purpose  to  present  the  matter 
purely  from  a  business  point  of  view,  and  to  call 
your  attention  to  the  advantages  to  be  gained  by 
the  city's  accepting  the  offer  in  that  respect,  well 
knowing  that  you  would  refer  the  matter  for  his 
opinion  to  my  esteemed  friend,  Mr.  Scott,  in  his 
official  capacity  as  Corporation  Counsel :  and 
knowing,  as  I  do,  that  his  knowledge  regarding  all 
matters  appertaining  to  city  affairs  far  exceeds  my 
own,  I  shall  not  attempt  to  anticipate  him  in  ex- 
pressing a  legal  opinion  as  regards  this  matter.  I, 
however,  would  in  this  respect  call  your  attention 
to  the  fact  that,  so  far  as  the  Eighth  Avenue  Road 
is  concerned,  the  effect  of  the  contract  of  Septem- 
ber, 1851,  and  the  relations  of  the  owners  of  that 
franchise  and  the  city,  have  been  fixed  and  estab- 
lished by  a  judgment  construing  the  agreement, 
thus  making  it  res  acljudicata,  and  that  judg- 
ment has  been  affirmed  by  the  Court  of  Appeals, 
putting  it  absolutely  beyond  doubt  or  question. 

The  case  I  refer  to  is  that  of  the  Mayor,  etc., 
against  the  Eighth  Avenue  Railroad  Company  to 
recover  license  fees  and  was  commenced  for  the 
City  by  Mr.  William  C.  Whitney,  as  Counsel  to 
the  Corporation,  in  1881,  and  the  complaint  states 
that  the  contract  of  1851  was  the  basis  of  the  then 
existing  franchise  (which  is  now  in  exactly  the 
same  condition),  the  railroad  company  in  its  an- 
swer claiming  that  the  Act  of  May  19,  1874,  ex- 
tending the  route  of  the  Eighth  Avenue  Railroad, 
superseded  the  said  contract,  and  that  the  company 
was  no  longer  subject   to  its  terms  and  conditions. 


11 


i 


-««^*«^if>!a<iS«i*^*»« 


14 


but  was  controlled  only  by  the  CTeneral  Kailroad 
Act.  The  Court,  however,  expressly  decided 
otherwise,  and  a  judgment  for  $43,062  was  recov- 
ered by  the  city  for  license  fees  provided  for  in  the 
original  contract.  On  appeal,  the  then  General 
Term  of  this  Department  affirmed  the  judgment 
(48  Hun,  614),  and  in  July,  1889,  the  cause  was 
argued  in  the  Court  of  Appeals  by  that  eminent 
lawyer,  Mr.  David  J.  Dean,  by  whose  recent  death 
the  city  has  lost  a  most  devoted  and  learned  advo- 
cate. The  points  passed  upon  by  the  Court  of  Ap- 
peals, as  appears  by  the  briefs  of  counsel,  fully  cover 
all  that  can  be  raised  at  the  present  time,  and  the 
counsel  for  the  railroad  company  very  ably  argued 
the  point  that  the  Act  of  1874  superseded  the  con- 
tract of  185h  and  that  the  company  had  acquired 
new  rights  thereunder  which  abrogated  its  liabili- 
ties under  the  original  contract.  On  the  other 
hand,  Mr.  Dean  contended  that  the  Act  of  1874  did 
not  relieve  the  company  from  any  liabilities  or 
alter  its  charter  as  set  forth  in  the  contract,  and 
that  it  did  not  release  the  company  from  any 
liabilities,  but  that,  if  it  had  attempted  so  to  do, 
it  would  have  been  unconstitutional. 

Mr.  Dean  especially  called  attention  in  his  brief 
to  the  important  riglits  of  the  city  under  the  con- 
tract, including  that  of  demanding  the  surrender 
of  the  roads  and  to  regulate  the  motive  power,  and 
claimed  that  the  Legislature  had  no  power  to  abro- 
gate those  rights,  as  any  attempt  so  to  do  would 
be  in  violation  of  the  Constitutions,  both  of  the 
United  States  and  the  State  of  New  York,  as  it 
would  impair  the  obligation  of  a  contract.  The 
Court  of  Appeals,  in  affirming  the  judgment,  de- 
livered an  opinion  (Haight,  J.,  118  N.  Y.,  389), 
which  fully  sustained  Mr.  Dean  on  every  point, 
and  there  can  be  absolutely  no  question  as  to  the 
city's  rights  under  the  contract. 

Ninth. — Inasmuch,  therefore,  as  the  city  is  in  a 
position  to  avail  of  this  offer,  and  to  reap  the  bene- 
lit  of  provisions  which  were  so  wisely  inserted  in 
the  contracts  of  1851,  I  trust  that  yoii  will  favora- 
bly entertain  it.     Permit  me  to  remain. 

Yours  very  respectfully, 
Chaeles  Henry  Butleh, 

Attorney  for  Henry  J.  Braker, 
HU2  Broadway, 

Mew  York  City." 


15 

BILLS  AUTHORIZING  TH£  CITY  TO 
ACQUIRE  THE  ROADS. 


Senator  Ford'M  Bill. 

On  the  14th  instant  Senator  Ford  introduced  a 
bill  providing  that : 

*'  The  Mayor,  Aldermen  and  Commonalty  of  any 
city  containing  1,250,000  inhabitants  or  more,  ac- 
cording   to    the    last    Federal     census    or     State 


enumeration, 
to    time 
railroads 
reserved 
tracts    or 


are  hereby  authorized  from  time 
to  purchase  any  street  railroad  or 
which  such  city  may  have  a 
right  to  purchase  under  any  con- 
agreements,  under  and  by  virtue  of 
which  such  railroads  were  acquired  from  such 
Mavor,  Aldermen  and  Commonalty  or  such  Board 
of  Aldermen  and  Mayor  ;  and  to  pay  for  said  rail- 
roads with  the  proceeds  of  bonds  to  be  issued  by 
such  city  under  such  terms  as  the  Board  of  Esti- 
mate and  Apportionment  or  board  exercising  such 
functions  may  prescribe,  and  in  an  amount  not  ex- 
ceeding the  cost  of  such  railroad  or  railroads." 

The  city  is  authorized  bv  the  bill  to  maintain 
and  operate  such  roads  as  it  thus  acquires  or  to 
lease  them  to  the  highest  bidder  for  twenty-five 
years.  This  bill  has  been  referred  to  the  Railroad 
Committee." 

Senator  PaYey'§  Bill. 

On  the  15th  instant,  the  following  bill  authoriz- 
ing the  city  to  acquire  these  roads  was  introduced 
by  Senator  Pavey : 

Ax  Act 

To  empower  city  of  New  York  to  acquire  and 
operate  or  lease  certain  railroads  in  said  city,  and 
to  provide  funds  by  the  issue  of  bonds  and  other- 
wise for  such  purpose. 

Sec.  1.  The  Mayor,  Aldermen  and  Commonalty 


i^ 


16 

of  the  City  of  New  York,  are  hereby  authorized  to 
exercise  the  power  to  purchase  the  raih'oads  of  the 
Sixth  Avenue  Railroad  Conii>anv  and  the  Eighth 
Avenue  Railroad  Company  under  the  terms  of  the 
agreements  executed  September  6,  1851,  confirmed 
by  Ch.  140,  L.  1854. 

Sec.  2.  The  said  Mayor,  Aldermen  and  Com- 
monalty are  authorized  to  own  and  to  lease  said 
railroads  when  acquired,  and  to  grant  the  right, 
privilege  and  franchise  of  operating  the  same  ro 
any  person  or  corj^oration  for  a  period  not  exceed- 
ing twenty-live  years  ;  such  grant,  at  the  option  of 
the  city,  to  provide  for  giving  to  the  grantee  the 
right  upon  a  fair  revaluation  or  revaluations  to  re- 
newals not  exceeding  in  the  aggregate  twenty-five 
years. 

Sec.  3.  Said  Mayor,  Aldermen  and  Commonalty 
may  provide  funds  with  which  to  acquire  said  rail- 
roads or  either  of  them  by  contract  with  the  person 
or  corporation  proposing  to  lease  said  railroads,  to 
advance    thereon   rentals    sufficient   to   equal   the 
sums  necessary    to   be   paid   therefor   under   said 
agreements,  or  may  provide  funds   by   the  issue, 
sale  and  disposition  of  bonds  of   the   city  of  New 
York,  bearing  interest  at  a  rate  not  exceeding  four 
per  cent,  per  annum  and  upon  such  terms  as  the 
Board  of  Estimate  and   Apportionment  may  pre- 
scribe.    Such  bonds  when  issued  shall  be  sold  by 
the  Comptroller  upon  the  requisition  of  the  Mayor 
and  Board  of  Aldermen.     The  amount  of  the  bonds 
authorized  to  be  issued  shall  not  exceed  the  cost  of 
the  said  railroads  or  either  of  them  to  the  city  un- 
der said  agreement. 

Sec.  4.  This  act  shall  take  effect  immediately. 
This  bill  has  been  referred  to  the  Cities  Committee. 
It  is  advocated  by  the  City  Club. 


17 

THE  ACTUAL  ACQUIREMENT  OF 
THESE  ROADS  BY  THE  CITY  OR 
THE  OBTAINING  OF  MORE 
REVENUE  FROM  THEM  IS  URGED 
BY  THE  CORPORATION  COUNSEL, 
THE  CITY  CLUB,  THE  BOARD  OF 
ALDERMEN,  THE  WORKINGMEN, 
THE  BOARD  OF  TRADE,  THE  DEMO- 
CRATIC LEAGUE  OF  KINGS 
COUNTY,  THE  NEWSPAPERS,  AND 
BY  CITIZENS  AND  TAXPAYERS. 

Corporation  €oun§el  Seott  iirgei  the  pa§§age  of 
lc|g[i§latioii  to  the  end  that  the  citj  may  aequire 
the  road§. 

The  Corporation  Counsel,  appreciating  the  great 
value  of  these  franchises  to  the  city,sent,  on  the 
a 5th  instant,  the  following  earnest  letter  to 
Senator  Raines,  Chairman  of  the  Senate  Railroad 
Committee,  to  which  was  referred  Senator  Ford's 
bill: 

"I  am  informed  that  the  Hon.  John  Ford,  a- 
Senator  from  this  city,  yesterday  introduced  a  bill, 
which  was  referred  to  your  committee,  aiuhorizin<^ 
the  municipal  authorities  of  any  city  containino-  a 
million  and  a  quarter  inhabitants  to  purchase  a^y 
street  railroad  or  railroads  which  such  city  may 
have  a  reserved  right  to  purchase  under  any  con- 
tracts or  agreements  under  and  by  virtue  of  w^hich 
such  mil  roads  were  acquired. 

^' This  bill  is  evidently  designed  to  put  the  city 
of  JNew  York  in  a  position  to  take  advantage  of  the 
reservation  contained  in  certain  agreements  made 
with  the  predecessors  of  the  present  Sixth  and 
J^ighth  Avenue  Railroads,  wherein  it  was  provided 
that  the  city  of  New  York  might  at  any  time  com- 
pel the  surrender,  conveyance  and  transfer  to  itself 
of  each  of  said  railroads  upon  the  payment  of  the 
cost  of  construction  with  ten  per  cent,  advance 
thereon. 


-^■•t^mm^tii^'mgaHm 


18 


19 


(( 


This  condition  has  recently  been  the  subject  of 
much  discussion,  and  the  question  of  its  validity  is 
collaterally  involved  in  certain  cases  now  pending 
in  the  Courts  of  this  city.  Of  course,  the  present 
owners  of  the  valuable  franchises  involved  would 
be  loath  to  part  with  their  property  upon  the 
terms  referred  to  and  suggest  many  reasons  why, 
as  they  allege,  the  condition  was  either  invalid 
when  made  or  has  since  been  abrogated  or  waived. 

''I  do  not  intend  at  the  present  time  to  express 
any  opinion  as  to  the  present  validity  of  the  con- 
dition or  as  to  the  any  of  the  numerous  reasons 
assigned  why  it  is  invalid.  Whether  valid  or  not, 
the  city  of  New  York  has  no  authority,  under  any 
existing  statute,  either  to  raise  the  money  which 
would  be  required  to  repurchase  these  roads,  nor, 
having  repurchased  them,  has  it  authority  to  oper- 
ate a  street  railroad.  It  is,  therefore,  impossible  to 
bring  a  direct  action,  in  the  nature  of  a  suit,  for 
the  specific  performance  of  the  condition  referred 
to,  because  it  is  of  the  very  essence  of  such  an 
action  that  the  plaintiff  should  be  able  to  affirm  his 
ability  and  willingness  to  comply  with  his  part  of 
the  contract,  and,  until  we  are  put  in  a  position 
where  we  can  allege  that  we  are  ready  and  able  to 
pay  to  these  roads  the  ])rice  prescribed  in  the  con- 
dition as  tlie  consideration  of  the  reconveyance,  we 
are  unable  to  bring  any  action  to  enforce  the  con- 
ditions. 

''  The  franchises  involved  are  of  very  great  value 
and  if  the  city  has  any  claim  of  right  to  them  the 
Legislature  should  not  hesitate  to  put  us  in  a  posi- 
tion to  assert  that  right.  I  therefore  venture  to 
beg  of  you  that  your  committee  will  give  early  and 
favorable  consideration  to  the  bill,  and  I  still  ven- 
ture to  hope  that  it  may  not  be  too  late  to  secure 
the  passage  of  proper  legislation  to  give  to  the  city 
of  New  York  authority  to  raise  funds  necessary 
for  an  acquisition  of  its  rights  and  to  operate  or 
lease  the  roads  when  so  acquired.  This  will  put  us 
in  a  position  to  enforce  whatever  rights  we  may 
have,  which,  as  1  have  explained,  we  cannot  use  at 
present." 

Aetive  ^^ork  by  the    City  Club. 

Almost  immediately  upon  the  issuance  by  the 


Commissioner  of  Public  Works  of  his  consent  that 
the  Metropolitan  Company  should  put  in  its  new 
electric  power  on  the  Eighth  avenue  line,  the  City 
Club,  by  resolution,  disapproved  of  this  permit. 

On  the  afternoon  of  the  9th  instant  a  delegation 
of  the  club  went  before  the  Mayor  and  presented 
the  following  resolution,  passed  by  the  club,  and 
expressing  its  position  on  this  question  : 

"  Resolved,  That,  in  the  opinion  of  the  City  Club, 
it  is  for  the  interest  of  the  city  of  New  York  to  ex- 
ercise forthwith  its  right  to  acquire  by  purchase 
the  property  and  franchises  of  said  corporations  ; 
and 

'*  Resolved,  That  the  City  Club  favors  the  imme- 
diate introduction  and  passage  of  such  legislation 
as  may  be  necessary  to  accomplish  that  end  ;  and 

''Resolved,  That,  upon  the  acquisition  of  said 
property  and  franchises,  the  city  should  forthwith 
sell,  under  the  provisions  of  Section  93  of  the  Rail- 
road Law,  at  public  auction,  to  the  highest  bidder, 
the  right  to  operate  said  railroads  for  a  term  not 
exceeding  twenty-five  years,  with  a  right  to  renew 
for  a  term  not  exceeding  twenty-five  years,  upon  a 
readjustment  of  the  rental." 

Backing  up  these  resolutions  was  presented  a 
letter  signed  by  Dr.  E.  R.  L.  Gould,  William 
Travers  Jerome,  Frank  J.  Goodnow,  Horace  E. 
Deming  and  Albert  Shaw,  composing  the  Commit- 
tee on  Street  Franchises,  containing  a  review  of  the 
subject  and  the  following  statements  : 

'*We  understand  that  the  only  obstacle  in  the 
way  of  the  city's  acquiring  the  property  in  ques- 
tion at  a  moderate  cost,  under  the  terms  of  the 
very  contracts  by  which  these  corporations  hold 
their  franchises,  is  the  lack  of  specific  authority  to 
issue  bonds  for  the  purchase  price.  We  have  no 
doubt  that  a  request  from  you  to  the  Legislature 
would  bring  the  requisite  authority.  We  there- 
fore respectfully  suggest  that  you,  acting  with  the 
Corporation  Counsel,  have  prepared  and  promptly 
sent  to  the  Legislature  a  bill  embodying  whatever 


-I 

-■I 


'! 


I 


m 


20 


authority  you  may  need  to  enable  you  to  protect 
the  interests  of  the  cit}^  in  respect  to  these  import- 
ant franchises. 

In  the  past,  as  is  well  known,  a  X)olicy  has  been 
pursued  which  has  forfeited  the  possibility  of  mu- 
nicipal profit  from  increments  in  the  value  of  pub- 
lic franchises.  If  the  wiser  and  more  far-seeing 
policy  for  which  you  stand  had  been  adopted,  not 
only  would  the  original  investors  have  got  back 
their  first  outlay,  with  a  handsome  profit,  but  the 
idty  would  have  received  millions  of  dollars  every 
year  with  which  to  lighten  the  expenses  of  govern- 
ment. 

There  is  a  strong  popular  feeling,  which  we  be- 
lieve to  be  well  founded,  that  the  present  situation 
with  regard  to  the  Sixth  Avenue  and  Eighth  Ave- 
nue Railroad  franchises  presents  unexpectedly  and 
auspiciously  an  opportunity  for  you  to  inaugurate, 
without  waiting  for  the  new  charter,  the  sound 
I)olicy  of  preserving  for  the  city  those  valuable 
rights  which  its  growth  has  created  and  its  exist- 
ence makes  possible. 

The  Club  has  urged  upon  the  Mayor  and  the 
Corporation  Counsel  the  further  considerations  in 
reference  to  the  new  privilege,  which  the  Metro- 
politan Company  seeks  on  Sixth  and  Eighth  ave- 
nues, of  substituting  electric  for  horse  power: 

''1.  That  any  substantial  payment  that  the  city 
could  properly  secure  for  the  greatly  increased 
value  of  the  franchises  due  to  the  right  which  it  is 
proposed  to  give,  ought  to  be  secured. 

2.  That,  whatever  may  be  done  as  to  the  ap- 
plication of  the  Metropolitan  Company,  care  ought 
to  be  taken  that  any  right  of  purchase  which  the 
city  may  have  under  the  express  provisions  of  the 
old  contracts  between  the  city  and  the  original  com- 
panies, should  be  carefully  guarded. 

The  contracts  of  1851  expressly  prohibit  the  use 
of  any  motive  power  but  horses  upon  a  consider- 
able part  of  these  lines.  The  actual  cost  of  the 
lines,  as  they  stand  to  day,  is  trifling,  and  their 
potential  value  after  the   introduction    of   the   un- 


21 


derground  trolleys  is  enormous.  77ie  question  is, 
therefore,  w7i ether  the  city  shall  now  acquire  this 
enormous  potential  value  at  trifling  expense,  or 
whether  it  shall  permit  a  corporation  to  reap  the 
entire  benefit. 

It  must  be  remembered  that  under  the  old  con- 
tracts, under  which  the  lines  are  now  operated, 
and  under  which  they  would  continue  to  be 
operated  with  the  new  form  of  power,  the  city  can- 
not exact  any  annual  ])ayments  for  the  privilege 
of  operating  the  franchises.  If,  however,  the  lines 
are  now  acquired  by  the  city,  the  way  will  be  open 
for  a  readjustment  upon  the  most  favorable  terms 
which  the  city  can  exact. 

While  the  situation  may  present  legal  diffi- 
culties, the  above  statement  makes  it  clear  that  it 
is  for  the  interest  of  the  community  that  every 
effort  should  be  made  to  preserve  to  the  city  any 
rights,  which  it  may  have  in  these  valuable  fran- 
chises. The  City  Club  is  of  the  opinion  that  the 
X)rinciple  of  retaining  in  the  city  the  ultimate  con- 
trol of  street  franchises,  which  has  been  wisely  em- 
bodied in  the  proposed  Greater  New  York  charter 
and  in  the  platform  of  the  Citizens'  Union,  should 
be  applied  immediately  in  this  case.  A  bill  author- 
izing the  city  to  issue  the  bonds  necessary  for  the 
X^urchase  of  the  roads  would  afford  a  ready  means 
of  accomplishing  this  end." 


The   Stand   Taken   by   tlie   Board   of 

Aldermen. 

The  public-spirited  position  of  the  Board  of  Al- 
dermen is  set  forth  in  the  following  article  printed 
in  the  Herald  on  the  14th  : 

PROBING^  RAILROAD   COMPANIES. 

ALDERMEN   WANT   TO    KNOW  IF   THE   CITY    HAS    ANY 

KIGHTS. 

The  Railroad  Committee  of  the  Board  of  Alder- 
men has  been  considering  the  proposition  that  the 


"T'^^^'-m^mm 


II 


22 


€ity  should  acquire  by  purcliase  the  Sixth  and 
Eighth  avenue  railroads.  *  *  *  The  preamble 
of  the  second  resolution  says  that  in  the  agreement 
made  between  the  promoters  of  the  roads  and  the 
city  on  September  6,  1851,  it  is  stipulated  that  no 
motive  power  except  horses  shall  be  used  below 
Forty-second  street  on  the  Eighth  avenue  road  and 
Fifty-first  street  on  the  Sixth  avenue  road. 

The  companies  have  never  be^^n  released  from 
these  stipuhitions.  The  Commissioner  of  Public 
Works,  however,  has  given  the  roads  permission  to 
open  the  streets  for  the  purpose  of  oonstr acting 
subway  pits  to  be  used  for  a  sub-trolley  electrical 
traction  system,  and  no  compensation  has  been  de- 
manded lor  the  occupation  of  space  underneath  the 
surface  of  the  streets,  which,  if  paid  for  at  the  rate 
of  vault  permits,  would  bring  the  city  a  revenue  of 
$2,000,000  or  $3,000,000. 

The  resolution  requests  the  Corporation  Counsel 
to  inform  the  Board  if  the  consent  of  the  Board  is 
necessary  before  the  change  of  power  can  be  made, 
iind  also  if  the  failure  of  the  companies  to  file  the 
statements  of  receipts  and  cost  of  construction  of 
(he  roads  would  cause  the  Courts  to  declare  the 
franchises  forfeited. 

Alderman  Oakley  moved  to  lay  the  matter  over 
for  two  weeks,  and  the  motion  was  finally  carried. 

The  Deiiiandi  of  tlie  IVorkiiigmeii. 

The  attitude  of  the  workingmen  is  well  set  forth 
in  an  article  printed  in  tlie  Journal,  of  April  9tli, 
entitled : 

''  The  city  should  ow^n  these  roads." 

Mayor  Strong  urged  to  secure  the  Sixth  and 
Eighth  Avenue  lines. 

This  was  in  reference  to  a  hearing  given  by  the 
Mayor  to  the  Knights  of  Labor  and  other  working- 
mens'  organizations  in  favor  of  the  city's  acquiring 
the  roads. 

Their  ideas  were  embodied  in  a  memorial  which 
declared  in  part  : 

The  opportunity  presents,  in  the  existing  con- 


23 


tracts  of  the  city  with  the  Sixth  and  Eighth  Avenue 
Companies,  to  avail  yourself  for  the  city  of  the 
rights  already  existing  and  declared  valid  by  the 
Court  of  Appeals.  Under  these  contracts  the  city 
has  the  right  to  acquire  the  Sixth  and  Eighth 
Avenue  roads  on  the  payment  of  the  cost  of  con- 
struction and  ten  per  cent,  additional.  The  rental 
at  present  paid  for  the  use  of  these  franchises  is 
about  $400,000  per  annum. 

For  this  sum  the  original  Sixth  and  Eighth 
Avenue  Companies  have  leased  to  the  Metropolitan 
Traction  Company  their  rights  and  privileges. 
TJiere  is  iio  reason^  in  either  equity  or  law,  why 
this  great  sum,  equivalent  to  the  interest  on 
$13,000,000  of  the  city  bonds,  should  not  he  paid 
direct  to  the  city,  instead  of  to  a  private  corpora- 
tion. The  sum*  required  to  exercise  this  option 
and  to  acquire  this  revenue  for  the  city  is  so  small 
that  it  could  readily  be  made  by  the  issue  of  short 
time  bonds,  which  the  rental  would  cancel  within 
three  years. 

Mr.  Towns,  of  'Brooklyn,  counsel  for  the  men, 
told  the  Mayor  that  the  acquirement  of  the  roads 
■was  a  business  opportunity,  which  should  not  be 
neglected. 

*' These  roads,"  said  he,  ''can  be  purcliased  for 
less  than  $2,000,000,  and  the  city  can  either  sell 
them  over  again  at  a  great  profit  to  operate  them. 
We  represent  ninety-eight  per  cent,  of  the  people, 
who  neither  own  real  estate  nor  railroad  stock,  and 
whose  only  interest  is  good  service  at  moderate 
cost." 


:l 


At  this  hearing  representatives  of  the  Association 
for  the  Public  Control  of  Franchises  and  of  the 
Democratic  League  of  Kings  County  also  advocated 
the  purchase  of  these  roads. 

The  Board  oi  Trade  declares  for  revenue  to  tlie 
city  out  of  its  franchises  and  calls  upon  the  city 
authorities  to  act. 

Acting  on  a  report  of  its  Committee  on  City 


4 


■i*Wa«i^Mbd«Bntta^US 


li 


1 

II 


24 

Affairs,   the  Board,  on  the  14th  instant,  declared 
by  resolution : 

That  it  is  the  dnty  of  our  city  authorities  to  con- 
serve the  valuable  rights  of  the  municipality  for 
the  benefit  of  all,  and  while  treatins:  corporations 
justly  treat  the  public  interest  justly.  TTiat  the 
time  to  make  this  adjustment  is  now,  not  after  the 
cost  has  been  enormously  ehhanced  by  the  change 
of  motive  poicer  throno:h  the  medium  of  a  con- 
struction company  making  an  enormous  profit,  and 
we  have  confidence  that  our  present  Mayor,  Cor- 
poration Counsel  and  Commissioners  of  Public 
Works  will  do  their  duty  and  protect  the  public 
interest  in  this  important  matter. 

That  the  Committee  on  City  Affairs  of  this  Board 
be  and  is  hereby  authorized  and  instructed  to  con- 
fer with  said  authorities  and  co-operate  with  other 
organizations  to  the  same  end. 

Suit  brought  by  a  taxpayer. 

Following  close  upon  the  permit  granted  by  the 
Commissioner  of  Public  Works  to  the  Metropoli- 
tan Company  to  put  in  its  new  power  on  Eighth 
avenue  cars  came  a  temporary  injunction,  ob- 
tained by  Eugene  Clifford  Potter  w^ho  set  up 
in  his  complaint  the  contract  right  of  the 
city  in  the  Eighth  avenue  road  and  alleo:ed  that  it 
would  be  a  waste  of  the  city's  property  if,  in  spite 
of  Mr.  Braker's  offer  for  the  Eighth  avenue  line, 
the  Metropolitan  Company  should  be  allowed  to 
burden  the  road  with  an  expenditure  of  $ij,000,(K)0 
in  changing  its  motive  power ;  thereby  increasing 
the  cost  to  the  city  if  it  should  wish  to  avail  itself 
of  Mr.  Braker's  offer.  Mr.  Potter  also  alleged 
that  the  Eighth  Avenue  Company  was  bound  by 
its  charter  not  to  use  any  power  but  horse  below 
Fifty-first  street  and  it  should  not  be  released  from 
that  contract  without  giving  compensation  therefor. 


25 

THE  SENTIMENT  OF  THE  PUBLIC 
IN  NEW  YORK  CITY  IS  REELECTED 
IN  THE  PRESS  WHICH  BELIEVES 
AND  URGES  THAT  THE  CITY  SHOULD 
EXERCISE  ITS  OPTION  OF  BUYING 
IN  THESE  TWO  ROADS  OR  MAKING 
A  PROFIT  OUT  OF  THESE  FRAN- 
CHISES TO  THE  END  THAT  THE 
CITYS  REVENUES  MAY  BE  IN- 
CREASED. 


I 


1 


The  Sun. 

The  Sun,  on  the  1st  instant,  spoke  as  follows  in 
an  editorial  entitled  : 

**  City    Ownership  of  Street  Railroads. 

The  decision  of  the  Court  of  Appeals,  affirming 
the  constitutionality  of  the  Underground  Rapid 
Transit  Act,  has  an  important  bearing  upon  the 
war  now  raging  between  the  Metropolitan  Traction 
Company  on  the  one  side,  and  the  Third  Avenue 
Railroad  Company  on  the  other.  These  two  com- 
panies are  fighting  for  the  control  of  the  street 
railroad  system  in  the  upper  part  of  Manhattan 
Island  and  in  the  adjacent  territory,  and  the  Third 
Avenue  Company,  under  the  generalship  of  its 
counsel,  Edward  Lauterbach,  has  taken  the  offen- 
sive against  the  Traction  Company,  not  only  in  the 
particular  field  for  the  possession  of  which  the  two 
are  struggling,  but  wherever  it  can  hit  its  adver- 
sary. 

The  Metropolitan  Traction  Company  is  lessee  of 
the  Sixth  Avenue  and  of  the  Eighth  Avenue  street 
surface  railroads,  and  desires  to  change  the  motive 
power  employed  on  those  roads  from  horses  to 
electricity.  It  has  obtained  the  consent  of  the 
Railroad  Commissioners  to  the  change,  against  the 
opposition  of  the  Third  Avenue  Railroad  Com- 
pany, but  the  Third  Avenue  has  now  discovered 
another  and  more  serious  way  of    annoying  its 


I 
1 


>^'"  ^  imm. 


-^-t..^pjsaiK«^4 


Itii 


I 


26 

rival  The  licenses^riginally  granted,  in  1851,  by 
the  Mayor  and  Aldermen  of  this  city  to  the  per- 
sons who  afterwara  formed  the  Sixth  Avenue  and 
the  Eighth  Avenue  Kailroad  Companies,  fo  lay 
down  tracks  over  the  streets  now  occupied  by  them, 
botli  contained  the  stipulation  that  the  grantees 
*^  shall  file  with  the  Comptroller  a  statement,  under 
oath,  of  the  cost  of  each  mile  of  road  completed, 
and  agree  to  surrender,  convey,  and  transfer  the 
said  road  to  the  corporation  of  the  city  of  New 
York,  whenever  required  to  do  so,  on  payment  by 
the  corporation  of  the  cost  of  said  road,  as  ap- 
pears by  said  statement,  with  ten  per  cent,  advance 
thereon." 

Now  comes  the  Third  Avenue  Railroad  Company 
and  demands  that  the  city  shall  exercise  the  option 
thus  provided  for,  and  backs  up  its  demand  by 
offering  either  to  purchase  the  roads  at  an  advance 
of  8500,000  each,  on  the  price  at  which  the  city  has 
the  right  to  take  them,  or  to  lease  them  at  a  rental 
often  percent,  per  annum  on  that  price,  with  the 
addition  in  either  case  of  live  per  cent,  of  the  gross 
receipts.  As  reported  to  the  State  Railroad  Com- 
missioners in  1895  the  cost  of  the  Sixth  Avenue 
Railroad  was  $621,605,  and  that  of  the  Eighth 
Avenue  $665,181.  The  Sixth  Avenue  road  is  leased, 
at  present,  to  the  Metropolitan  Traction  Company 
for  $145,000  a  year  and  the  Eighth  Avenue  for 
$215,000  a  year,  making  on  a  capitalization  at  five 
per  cent-,  the  value  of  the  Sixth  Avenue  Railroad 
$2,900,000,  and  that  of  the  Eighth  Avenue  $4,300,- 
000.  The  city  would  thus  get  for  about  $1,400,000 
properties  worth  $7,200,000,  and  the  price  offered 
by  the  Third  Avenue  Company  is,  therefore,  en- 
tirely inadequate.  It  is  intended,  doubtless,  merely 
as  a  starting  bid,  upon  which  an  advance  may  be 
made  in  due  time. 

The  question  naturally  suggests  itself,  why  the 
city  has  for  so  many  years  slept  upon  its  rights 
under  its  contracts  with  these  street  surface  rail- 
road companies,  and  why  the  lessees  of  the  roads 
have  treated  as  nugatory  the  agreement  providing 
for  their  sale  to  th6  city.  The  answer  is  that, until 
the  Court  of  Appeals  declared  that  building  and 
operating  railroads  is  a  municipal  purpose,  it  was 
assumed  that  the  city  had  no  constitutional  right 


27 


to  buy  a  street  railroad,  and,  therefore,  that  it 
could  never  exercise  the  option  of  purchase  given 
it  by  its  contract  with  the  licensees  of  the  Sixth 
and  the  Eighth  avenue  roads.  There  may  be  other  ob- 
stacles to  its  purchasing  the  roads,  of  which,  no 
doubt,  the  parties  in  interest  will  avail  themselves, 
but,  on  the  facts  as  they  now  appear,  the  city  has 
the  right  to  become  their  owner,  on  advantageous 
terms,  and  it  ought  in  the  interest  of  the  taxpayers 
to  exercise  it.  If  it  can  get  for,  say  $l,400,000,*bor- 
rowing  the  money  at  three  per  cent.,  properties 
which  will  bring  it  in  a  revenue  of  $360,000  a  year, 
it  will  make  an  addition  to  its  income  of  $318,000, 
which  is  a  sum  not  lightly  to  be  thrown  away." 


The  Tribune. 


In  the  following  editorial,  printed  on  the  5th  in- 
stant, the  Tribune  demands  that  the  city  should 
get  fair  compensation  for  its  franchises  : 

"  How  tlie  Cily  Is  ^Vroiig^ed. 

At  least  one  clause  in  the  Greater  New  York 
charter  deserves  hearty  commendation,  even  if  the 
document  contains  a  great  many  things  which  do 
not  merit  praise.  That  clauvse  forbids  the  granting 
of  municipal  franchises  and  privileges  in  perj)e- 
tuity.  If  all  the  street  railways,  the  elevated  roads, 
the  gas  companies,  the  ferry  companies  and  other 
corporations  had  been  compelled  from  the  time  of 
their  origin  to  pay  to  the  j3ublic  treasury  equitable 
and  adequate  compensation  for  the  privileges  which 
they  have  obtained,  the  municipality  would  be 
getting  payments  from  these  com[)anies  running 
far  up  into  the  millions  every  year,  the  municipal 
debt  w^ould  be  only  a  quarter  of  its  present  pro- 
portions, and  the  burden  of  taxation  would  be  far 
lighter  than  it  is.  JNo  franchise  and  no  privilege 
ought  ever  to  have  been  granted  by  the  municipal 
authorities  or  by  the  Legislature  without  such  con- 
ditions that  the  city  should  receive  ample  compen- 
sation for  the  grants  made.  Birt  by  the  employ- 
ment   of  every  sort  of  improper   means,    dozens, 


'If 
-  ■*■. 
.*■ 
.1 


•y^0iimi&0'm^ 


ill 


28 

scores,  even  hnndreds.  of  corporations   have  been 
plundering   this    community  for  a   louff  series  of 
years  by  using  the  public   streets  or  other  public 
properly  of  one  kind  and  another  without  paying 
to  the  treasury  the  sums  to  which  the  city  is  justly 
entitled.     It  would  have  been    only  fair  and  just  if 
the  gas  companies  and  electric   lieht  companies 
had    been    required     to    furnish    all    the    lights 
needed   for  public   purposes  without  charge,  and 
also  to  pay  into  the  city  treasury  a  percentage  of 
their  gross  earnings.     These  companies  are  allowed 
to  tear  up  the  streets  and  avenues  and  to  lay  their 
pipes  in  our  thoroughfares.     What  return  do  they 
make  to  the  community  for  the  advantages  which 
they  possess  ?     Every  one  of  them  exacts  from  the 
city  unreasonable  prices  for  gas  and   electric  light- 
ing when  It  gets  an    opportunity  to   do    it.     The 
prohts  on  the  capital  honestly  invested  in  the  gas 
companies,  in  the  street  car  lines  and  the  elevated 
roads  have  been   prodigious.     The   city  ought  to 
have  Its  fair  share  of  these  profits.     It  has  been 
cheated  out  of  almost  all  that  should  have  come  to  it 
tor  the  use  of  the  streets  and  avenues  by  these  cor- 
porations. And  now  some  of  the  corporations  which 
have  been  steadily  depriving  the  city  of  its  just  dues 
lor  many  years  are  impudent  enough  to  be  askino- 
lor  extensions  of  vast  importance  and  value  with" 
out  any  purpose  of  paying  the   city  a  satisfactory 
price  tor  these  extensions.     Could  assurance  and 
audacity  go   further  i    How  much  more  of  wrong 
from  these  corporations  will  the  citizens  endure  ^ '' 


The  Press. 

The  Press,  in  the  following  editorial  printed  on 
the  2d  instant,  demands  that  the  city  assert  its 
rights. 

•The  Theft  of  Three  Avenues. 


Dr.  Albert  Shaw  has  called  Mavor  Strong's  at- 
tention to  the  fact  that  the  application  of  the 
Metropolitan  Traction  Company,  for  the  right  to 


29 


change  motive  power  on  three  great  avenues  is  vir- 
tually an  api)lication  for  new  charters  for  the 
Fourth,  Sixth  and  Eighth  avenue  lines.  The  sug- 
gestion may  well  be  heeded.  Dr.  Shaw  speaks 
with  an  autiiority  conferred  by  the  public  recogni- 
tion of  his  w^orks  on  municipal  government.  He 
stands  almost  alone  in  this  tield. 

But  no  suggestion  should  have  been  required  for 
action  long  ago.  More  than  a  suggestion  should 
before  now  have  proceeded  from  the  Corporation 
Counsel's  office.  An  injunction  should  have  pro- 
ceeded. The  question  should  be  now  in  the  Su- 
preme Court.  The  city  should  proceed  as  a  citizen 
proceeds  when  his  property  rights  are  attacked. 
He  does  not  w^ait  until  the  damage  is  done  and 
then  seek  to  have  its  amount  assessed  by  a  jury. 
He  seeks  relief  at  the  moment  of  the  menace.  Then 
he  gets  redress  either  by  Court  order  or  by  an  ad- 
vantageous settlement.  The  city's  procedure  is,  as 
in  the  Third  avenue  case,  to  wait  until  the  robbery 
is  completed  and  then  set  out  to  recover  the  goods. 

The  Press  forestalled  Dr.  Shaw  by  some  weeks 
in  pointing  out  what  the  Metropolitan  Traction 
Company  seeks  by  its  change  of  motor.  It  seeks 
to  obtain  for  about  $4,000  a  year  on  each  of  these 
great  lines  that  which  it  is  now  glad  to  pay  $200,000 
a  year  for  on  its  single  Broadw^ay  line.  Within 
less  than  twenty  years  it  will  be  depriving  this 
municipality  of  not  less  than  $1,000,000  a  year  rev- 
enue from  these  franchises.  Yet  if  the  city  fought 
for  its  rights  as  the  citizen  fights  for  his  this  rob- 
bery would  have  been  stopped  by  this  time.  As 
we  pointed  out  at  the  time  the  brief  of  opposing 
private  counsel  in  the  hearing  before  the  State 
Railroad  Commission  fairly  bristled  with  points 
for  the  city's  use.  These  have  been  largely  added 
to  since  the  offer  of  the  Third  Avenue  Company  to 
lease  the  lines.  They  have  been  so  largely  added 
to  that  the  indifference  of  the  Corporation  Counsel 
is  incomprehensible. 

Does  the  Corporation  Counsel's  office  take  it  for 
granted  that  the  Supreme  Court  will,  upon  a  mere 
technical  evasion  of  the  Cantor  Act,  alhnv  the  per- 
i)etration  of  this  systematic  swindle  'i  U  so,  it  has 
a  pretty  poor  opinion  of  the  Supreme  Court.     VVe 


f*;;'-^  : 

r*!*' 

«!*; 


-'f***!**-*^**!^. 


■r 


30 

mnv'..  hL.  ®''^''  consider  the  Metropolitan  Com- 
pany s  battered  position  so  impervious  to  attack 
that  It  would  not  yield  the  city's  dues  if  the  citv 
presented  the  points  which  have  beenraised  by  the 


The  IHail  aiul  Express. 

Tke  Mail  and  Express  declares  that  it  is  time 
for  the  city  to  act.  On  the  14th  instant  it  argues 
as  follows  ;  ^ 

"  The  City  and  the  Surface  Roads. 

The  bitter  struggle    between  the  Metropolitan 
Street  Railway   Company  and  the  Third  Avenue 
Kailroad  Company  for  the  control  of  the  Sixth  and 
ii^ighth  avenue  lines,  now  operated  by  the  former 
corporation,  has  reached  a  point  which  makes  it 
impossible  to  longer  ignore  the   tremendous  sacri- 
hces  the  city  has  made  in  the  past  in  granting  sur- 
face road   franchises.     It  is  a  matte?  of  little  im- 
portance  to  the  people  whether  the  Third  avenue 
defeats  the  Metropolitan,  or   the  Metropolitan  de- 
teats  the  Third  avenue  ;  but  it  is  of  great  imnort- 
ance  that  the  city-which   is  the  people^should 
take  advantage   of  any  right  which  the  law  may 
give  It   to  step   in    between  the  contestants,  and 
secure  its  own  reserved  riirhts. 

Ever  since  the  plan  to  change   the  motive  power 
on  the  Sixth  and  Eighth  avenue  lines  directed  at- 
tention to  the  terms  of  their  franchises,  granted  in 
lb51,    under  which    it  was   claimed   the  city  could 
secure  possession  of  the  roads  on  payment  of  cost 
and   ten   per  cent,  in  addition,    the   developments 
have  been  hot  and  rapid.     The  Third  avenue  has 
pressed   tor  the  taking  over  of  the   roads  by  the 
city   and  has  offered    to  pay  well  for  them.     The 
Metropolitan  has  held  that  the  city  cannot  take  the 
feixth  avenue  line,  because  the  road  had  been  sold 
by  the  original  owners,   aud  that  the  corporation 


31 

is  protected  as  to  the  Eighth  avenue  line  by  a 
statute  passed  in  1874,  which  placed  the  old  com- 
pany under  the  General  Railroad  Law,  repealed  all 
inconsistent  acts,  and  thus  deprived  the  city  of  its 
option. 

In  reply,  it  is  contended  on  behalf  of  the  Third 
avenue  company  that  the  sale  of  the  Sixth  avenue 
line  must  necessarily  have  been  made  with  all 
original  conditions  included,  and  that  it  was  be- 
yond the  power  of  the  sellers  to  nullify  the  city's 
vested  rights,  which  amounted  practically  to  an 
equity.  As  to  the  Eighth  avenue  line,  it  is  held 
that  a  Court  of  Appeals  decision,  based  on  an  effort 
by  the  company  to  avoid  the  payment  of  license 
fees  for  its  cars,  distinctly  stated  that  the  1874  law 
did  not,  and  could  not,  constitutionally,  impair  a 
contract  with  the  city.  If  this  was  true  of  license 
fees,  it  is  equally  true  of  the  city's  right  to  acquire 
the  property  under  the  conditions  stipulated. 

There  seems  to  be  little  doubt  that  the  city  would 
be  able  to  prove  in  Court  its  right  to  reacquisition. 
That  this  should  be  done  is  made  manifest  by  the 
sudden  assertion  of  a  value  which  has  heretofore  been 
strenuously  denied  by  the  parties  in  interest. 
First  we  tind  Mr.  Henry  J.  Braker— whether  act- 
ing for  himself  or  for  others  is  immaterial— offering 
to  pay  the  city  for  the  cost  of  the  two  roads,  the 
ten  per  cent,  additional  named  iir  the  original  con- 
tract, and  above  this  total  the  sum  of  $1,000,000  for 
each  franchise,  three  per  cent,  of  the  gross  receipts 
for  the  first  live  years  and  five  per  cent,  thereafter  ; 
at  the  same  time  guaranteeing  that  the  city's  share 
shall  be  not  less  than  $50,000  on  each  road  in  any 
year. 

The  Third  Avenue  Company  made  an  offer  of 
$1,000,000  over  the  cost  price,  and  then  to  lease  the 
roads  at  a  yearly  rental  of  ten  per  cent,  on  that 
price  and  live  per  cent,  of  the  year's  gross  receipts. 
Now  it  is  announced  that  the  Tliird  Avenue  Com- 
pany stands  [ready  to  pay  $4,000,000  for  these  two 
franchises.  Meanwhile  the  aldermen  are  divided 
as  usual,  and  probably  waiting  to  hear  from  the 
political  powers. 

If  these  two  franchises  are  worth  $4,000,000  to  a 
private  corporation,  they  are  certainly  worth  that 
sum,  if  not  more,  to  the  city,  and  it  is  the  duty  of 


II 


>     i 


,: 


32 

the  city  to  acquire  them  if  tlie  legal  right  is  main- 
tained. To  allege  confiscation  is  absurd.  The  city 
has  given  away  millions  upon  millions  in  franchises 
during  the  past  forty  years,  and  the  corporations 
which  received  them,  practicallv  as  a  free  gift, 
have  grown  rich  from  them.  The  offers  here  re- 
ierred  to  are  sufficient  proof  of  the  proposition 
that  with  adequate  returns  to-day  frc»m  this  source 
the  city  would  be  relieved  of  at  least  one-half  its 
general  tax  burden. 

It  is  rime  for  the  city  to  act— not  for  the  purpose 
of  municipal  operation,  but  to  secure  just  returns 
and  thus  relieve  the  taxpayer  of  unnecessary  bur- 
dens." 

And  again  on  the  16th  instant  it  argues  as  fol- 
lows : 

•'The  City  and  the  Surface  Road§. 

Corporation  Counsel  Scott,  in  his  letter  yesterday 
to  Senator  Raines  as  chairman  of  the   Senate  Rail- 
road Committee,  on  the  subject  of  city  purchase  of 
the  Sixth  and  Eighth  avenue  surface  roads,  pre- 
sents with  admirable  clearness  the   main  points  to 
be  considered   and   the   necessary  legal   steps  pre- 
liminary  to   definite  action.     He  does   noc,  it  is 
true,  pretend  to  pass  upon  the  validity  or  invalid- 
iry  of  the  claims  advanced  by  either  in  the  discus- 
sion.    He  very  properly   declines  to  express  an 
opinion  as  to  whether  the  original  agreement  made 
between  the  municipality  and  the  companies  near- 
ly fifty  years  ago— that  the  city  might  at  any  time 
reacquire  the  franchises  upon  payment  of  the  cost 
of  road  construction,  with  an  advance  thereon  of 
10  per  cent.— was  valid  when  entered  into  or  is 
valid  now  ;  for,  as  he  says,  there  are  now  pending 
in  the  Courts  of  this  city  certain  cases  in  which 
this  very  question  is  collaterally  involved. 

What  he  does  say,  however,  is  of  supreme  im- 
portance.. He  acknowledges  that  it  is  the  duty  of 
the  city  to  repurchase  franchises  worth  millions  of 
dollars,  if  the  right  to  do  so  can  be  established. 
But— and  here  he  reaches  the  very  heart  of  the 
problem— the  city  has  no  authority,  under  exist- 


38 

ing  statute,  either  to  raise  the  money  for  a  renur- 
chase  or  to  operate  railroads  after  securing  rhem 

thP  wJ^r'f  ^  ^  '-V-*  ^"^^  r^P'^rchase-even  with 
the  right  of  acquisition  established— without  the 

mani7ps?  'T^^^  ^^l^J^'  ''^''  ^^  '''^  contract  Is 
Fnrrl  nn  w^  "'f  ^  ^^'^  embarrassment  Senator 
•Fordon  Wednesday,  and  before  the  penning  of 
Mr  Scott's  letter  introduced  a  bill  authorizing^he 
city  to  issue  bonds  for  the  purchase  of  the  roads 
lo  meet  the  second  point  made,  a  second  biHwas 
introduced  yesterday  by  Senator  Pavey  empower 
mg  the  city  -to  acquire,  operale  or  lease  ^^th!se 
roads,  and  providing  also  for  the  issue  of  bonds 

it  is,  of  course,  probable  that  the  Pavey  bill  will 
be  substituted  for  Senator  Ford's  measure  in  com- 
mittee, as  the  latter  would   be  ineffectual  as    an 
enabling  acl.     There  is  another  point,  however  to 
be    cons^idered.  ^  Will    these    ac^s,    if  passed  and 
signed,  be  constitutional  ?    This  point,  it  seems  to 
us,  must  depend  upon  the  settlement  of  the  cases 
ZllTJ?'''  m  which  the  right  of  purchase  fs  a 
collateral  issue  or  upon  a  new  action  brought  by 
the  Metropolitan   Street  Railway  Company   with 
this  question  as  the  sole  issue.     The  Court  of  Ad- 
peals,  m  the  case  of  Ins.  Co.  vs.  Jenkins,  16  N    Y 
424,  says :  i        ^^.  x., 

''  The  Legislature  has  no  judicial  authoritv,  and 
cannot  control  the  Courts  in   respect  to   the  con 

statute-       '*^^"^''  ^'''^"°  ^'^^'"  ^'^"  declaratory 

Again,  in  Burch  vs.  Newburv,  10  N  Y  S74  tha 
same  Court  declares :  :^ »     ^  ^^-   ^ .,  ^74,  the 

''  The  Legislature  cannot  contingently  deprive  a 
person  of  property  the  right  to  which  was  perfect 
under  prior  laws."  p'^iicoi, 

There  is  little  doubt  that  the  defendant  corpora- 
tion would  leave  no  stone  unturned  to  retain  such 
valuable  property  as  is  now  the  subject  of  discus 
sion.  VV  hatever  may  be  the  decision  in  the  pend- 
ing cases  however,  there  exists  no  valid  reason  for 
delay  in  (he  Legislature,  in  view  of  the  near  nn 
proach  of  final  adjournment.  The  PaveT  biU 
should  be  put  through  will  all  speed  consistent 


;i 


■4 


f5 


34 


with  decency.  Then  let  the  the  test  be  made.  The 
city  should  not  be  left  helpless  in  the  event  of  the 
establishment  of  its  right  to  act.  The  importance 
of  covering  every  point  in  advance  has  already  been 
made  suflSiciently  clear. 

The  interview  with  Lawyer  William  C.  Trull, 
who  is  justly  reg?irded  as  an  expert,  published 
yesterday  by  the  Mail  and  Express^  contained 
figures  which  are  irrefutable.  They  show  that  the 
offer  of  $4,000,000  made  dy  the  Third  Avenue  Com- 
pany for  the  Sixth  and  Eighth  avenue  lines,  if  re- 
acquired by  the  ciry,  large  as  it  sounds,  is  still  in- 
adequate. They  show  that  in  its  street  railway 
franchises,  whether  already  granted  or  not,  the 
city  possesses  an  asset  which  should  pay  for  a 
considerable  portion  of  the  city  improvements,  and 
lessen  materially  the  burden  of  direct  taxation.  In 
its  water  front  and  its  docks,  the  city  has  another 
possible  asset  which,  if  utilized  to  the  utmost,  as 
in  Liverpool,  would  alone  almost  pay  the  annual 
budget.  Under  an  administration  which  spends 
the  city  moneys  honestly  and  economically  our 
citizens  are  waking  up  to  a  realization  of  the  hither- 
to latent  resources  of  the  municipality.  The  city 
railway  franchises  constitute  one  of  the  most  im- 
portant of  them. 


A 


85 

GREAT  VALUE  OE 
ROADS  TO  THE  CITY.  FACTS 
AND  REASONS  WHY  THE  CITY 
SHOULD  EXERCISE  ITS  OPTION 
OR  MAKE  NEW  TERMS  WITH 
THE    COMPANIES. 

statement  of  Facts  by  John  Har§en  Rlioadcs. 

In  the  following  strong  letter  printed  in  the 
Tribune  on  the  17th  instant,  Mr.  Rhoades  shows 
that  the  city  should  derive  great  revenue  from  these 
franchises : 


*6 


lVRO]\OIS    TO     THE    CITY. 


THE   STREET   RAILROADS'    EFFRONTERY   IN  DEMAND- 
ING  FRANCHISES   FOR   NOTHING. 


John  Harsen  Rlioades  Gives  Reasons  Why  Hand- 
some Revenues  Should  Be  Expected  from  the 
Traction  Companies. 

To  the  Editor  of  The  Tribune  : 

^/r.— Upon  my  return  to  the  city  after  an  ab- 
sence of  some  weeks,  my  attention  has  been  called 
to  an  editorial  in  your  paper  of  the  5th  inst.,  en- 
titled ''How  the  City  is  Wronged,"  and,  as  a 
citizen,  I  wish  to  thank  you  for  the  strong  and  very 
able  manner  in  which  you  have  presented  the  facts 
in  relation  to  franchises  in  our  public  streets, 
granted  by  the  Legislature  and  confirmed  by  the 
city  authorities  ;  for  the  principles  enunciated  are 
sound  to  the  core  and  should  be  repeated  in  every 
journal  until  the  rights  of  the  people  are  respected 
by  our  legislators  and  local  public  authorities. 

I  have  nothing  to  do  with,  nor  do  I  care  for,  the 
controversy  now  existing  between  the  Third  Ave- 
nue Railroad  and  the  Metropolitan  Street  Railway 
Company,  which  owns  and  operates  practically  all 


^41 


Al 


f: 

J 

.r1 


'Tr^»«*«ft' 


I!  1^ 


36 

the  surface  railroads  in  tlie  citv  except  the  Thinl 
Avenue  road  ;  nor  do  I  care  for  the  efforts  being 
made  to  substitute  other  motive  power  than  elec- 
tricity. In  the  end,  some  compromise  or  purchase 
will  be  made  which  will  stop  the  %ht.  but  which, 
unless  the  people  bestir  themselves,  will  leave  the 
public  as  unprotected  as  it  now  is.  But  I  do  care, 
and  every  citizon  should  care  and  protest  against 
the  authorities  giving  away  valuable  franchises 
without  receiving  adequate  compensation  for  the 
gift. 

I  agree  with  your  statement  that  if  the  street 
railroad  and  other  corporations  which  have  made 
money  out  of  franchises  lawfully  gr  inted  and  law- 
fully exercised  in  the  streets  of  this  city  had  been 
compelled  to  pay  to  the  city  fair  compensation  for 
the  privileges  granted  them,  the  city  would  be  ob- 
taining revenue  running  up  into  millions  every 
year,  and  the  municipal  debt  would  be  much  less 
than  at  present,  while  the  burden  of  taxation  would 
be  far  lighter  than  it  now  is. 

This  statement  of  yours,  it  seems  to  me,  is  es- 
pecially pertinent  at  the  present  time.     The  Metro- 
politan Street  Railway  Company  is,  and  has  been 
for  the  last  six  weeks,  trying  to  obtain  without 
compensation  the  most  valuable  franchises,  prob- 
ably, that  can  be  obtained   in  the  city.     I  refer  to 
the  applications  it  is  making  to  the  various  local 
authorities  for  permission  to  change  forty-five  miles 
of  its  road  on  Sixth,  Eighth  and   Ninth  avenues, 
and  Fifty-ninth  street  into  electric  roads.     As  they 
stand  to-day,  these  roads  are  among  the  best  pay- 
ing properties  in  the  city.     When  equipped  and 
operated   by   electricity,  a  far  cheaper  method  of 
traction,  undoubtedly  their  value  will  be  greatly 
increased.     The   Sixth  and   Eighth  avenue  lines, 
figuring  on  the  rents  which  the  Metropolitan  Com- 
pany pays   for  them,    represent  a  combined  ca[)- 
italization  variously  estimated  at  from  seven  to 
eight  and  one-half  millions  of  dollars.     I  under- 
stand that  the  total  cost  of  the  Eighth  avefiue  road 
is  $1,6(J0,000,  in  round  numbers,  and  tliat  the  en- 
tire cost  of  the  Sixth  avenue  line  is  $1,700,0(^0,  in 
round  numbers. 
When  these  roads  received  their  franchises  from 


37 

• 

the  city,  they  agreed  that  at  any  time  the  city,  by 
paying  the  cost  price,  with  10  per  cent,  additional, 
could  have  the  option  of  buying  them  in.  These 
franchises  were  acquired  about  forty  years  ago, 
when  almost  nothing  in  the  way  of  compensation 
was  asked  from  street  railroad  corporations  for 
their  franchises.  The  result  is  that  to-day  they  are 
earning  profits  undoubtedly  far  beyond  what  the 
local  authorities  in  those  early  days  imaorined  they 
could  ever  earn.  But  the  city  receives  hardly  any 
more  revenue  than  it  did  at  the  date  when  the'char- 
lers  were  granted,  while  the  roads  have  increased 
ten-fold  in  value. 

The  Sixth  avenue  company  agreed  with  the  city 
that  it  should  not  have  the  power  to  operate  its 
roads  by  any  power  other  than  horse  below  Forty- 
second  street.  The  Eighth  avenue  company  agreed 
also  not  to  use  power  other  than  horse  below  Fifty- 
first  street.  As  to  these  two  roads,  then,  the  Metro- 
politan company  is  asking  and  expecting  to  get  for 
nothing  most  remarkable  franchises.  On  the  Ninth 
avenue  and  Fifty-ninth  street  lines  it  merely  seeks 
permission  to  change  from  horse  to  electric  power, 
but  on  the  Sixth  avenue  and  Eighth  avenue  lines  it 
is  seeking  to  be  relieved  from  its  contract  not  to 
use  other  power,  and  for  the  privilege  of  using 
electric  power. 

Agreements  sucdi  as  these  made  by  the  Sixth 
avenue  and  Eighth  avenue  roads  with  the  city  must 
be  binding,  and  undoubtedly  the  roads  are  'bound 
by  their  contracts  until  released  by  the  city.  In 
effect,  therefore,  the  Metropolitan  company  is  ask- 
ing, as  to  these  two  roads,  for  absolutely  new  fran- 
chises. Already  it  has  obtained  the  consent  of  one 
authority,  the  Board  of  Railroad  Commissioners, 
and  only  a  few  days  ago,  with  but  little  opposition, 
it  applied  to  the  second  authority,  the  Commis- 
sioner of  Public  Works,  for  his  consent  to  these 
new  rights  which  it  seeks.  And  already  the  Com- 
missioner has  given  his  consent  as  to  one  of  the 
lines,  namely,  the  Eighth  avenue,  though  a  tax- 
payer has  nullified  this  consent  by  getting  an  in- 
junction restraining  its  taking  effect 

This  situation   makes  especially  pertinent  your 
statement  that  no  franchise  and  no  privilege  ought 


I- 


■""M-sr     .  '^-^iT'^  -"y^ji^p!  ^m^mM 


ii  i 


38 

ever  to  be  gninted  except  on  condition  that  the  cifv 
receive  ample  compensation  for  the  crrants  made 
1  Ills  IS  a  common-sense,  good  business  and  iustic« 
to  the  taxpayer.  And,  indeed,  wh v  should  the  city 
surrender  its  property  and  ri-hts  in  the  streets 
without  compensation,  and  that,  too,  ample  com- 
pensation? ^ 

The  construction  of  these   new    lines  of  road  will 
mean    that   through   about  forty-five  miles  of  our 
city  streets  this  company  will  appropriate  a  section 
of  the  soil  about  hve  feet   wide  and  two  feet  deep 
1  his   property   will   not  be  acquired  to  be  enioved 

these  old  franchises,  the  company  will  ^et  the  rio-ht 
in  perpetuity.     It  seems  to  me  that  there  can  hardl  v 
be  a  more  valuable  right  acquired  in  this  city      The 
city  obtains  in  the  aggregate  a  large   sum    for  the 
rental  of  the  space   under   its   sidewalks,  which  it 
leases  for  vault  purposes  to   tlie    property-owners 
along  the  streets      The  compensation  for  the  city  s 
land  leased  for  vault  purposes  varies  from  80  cents 
to  $2  a  square  foot.     As  a  matter  of  fact,  ^2  is  uni- 
formly charged,  and  if  this   company   should    nay 
rent  for  the  space-some  1,1()(),0()()  square  feet-i't 
asks  in  the  streets,  the  city  would   receive  into  its 
treasury  more  than  $2,300,000.      And  the  difficulty 
which  the  Rapid  Transit  Board  has  in   gettino-  the 
consents  of  property -owners  on  Broadway  south  of 
the  City  Hall  for  rights  which  would  interfere  with 
the  vaults  owned  by  these  private  proi)erty-owners 
and  the  reluctance  with  which  thnse  men  surrender 
their  rights,    show   how    valuable    they    consider 
them.  *^ 

Then   why  should  the  city  gram,  or  why  should 

any  private  corporation  expect  to  get  for  its   own 

beneht,  such  a  valuable  right  as  this  in  our  streets  ^ 

lliese   roads   yield    their  owners  good    profits  on 

stocks  representing  far  more  than  the  actual   cost 

of  the  roads.     In   the   case   of  the  Thirty-fourth 

street  road,  running  from  Sixth   avenue  co^Lexino- 

ton   avenue,   $1,000,000   bonds   have   been   issued 

representing   far   more   than  the   cost  of  the  road' 

based   upon   the  bond   issue  alone.      Why  should 

the  Metropolitan   Company  complain  if,  in   return 

lor  these  privileges,  which  will  so  greatly  increase 


39 


the  value  of  its  property,  it  be  compelled  to  pay 
the  city  nor  only  as  much  as  property-owners  along 
the  lines  of  our  avenues  and  streets  are  obliged  to 
for  the  use  of  sidewalk  vaults,  but  a  liberal  tax  for 
the  use  of  the  highway  itself? 

Judging  by  the  experience  of  the  past,  what 
protection  in  the  future  can  the  public  expect  '(  Is 
the  roadway  between  the  tracks  to  be  kept  in 
better  order  than  at  present  ?  Are  cars  enough  to 
be  run  to  prevent  the  overcrowding  which  now 
exists  ?  Is  the  speed  to  be  regulated  to  the  point 
of  safety  to  the  pedestrian  ?  Are  the  cars  to  be 
operated  at  moderate  speed  ?  Are  the  tracks  to  be 
kept  free  from  sanding  in  summer  and  salting  in  win- 
ter, and  the  piling  up  of  snow  on  each  side  of  the 
track  during  a  snowstorm  ?  And  are  the  fares  to 
be  lessened  to  the  point  of  a  50  per  cent,  annual  re- 
turn to  the  stockholders,  based  upon  the  actual  cost: 
of  the  roads  themselves  ?  In  other  words,  are  the 
taxpayers  and  the  public  to  receive  no  benefit  what- 
ever from  the  proposed  change  ? 

Without  much  thought,  and  generally  for  selfish 
reasons,  property  owners  along  the  routes  of  these 
railroads  are  giving  away  their  rights  under  a  form 
of  an  agreement  which  utterly  deprives  them  of  all 
^  redress  if  the  proposed  changes  prove  an  unmiti- 
gated nuisance  and  a  serious  detriment  to  the  value 
of  their  property.  Will  this  condition  of  things 
never  end  ;  and  are  the  pubic  to  suffer  forever  from 
the  assumption  by  these  corporations  of  rights 
which  would  not  be  tolerated  for  an  hour  in  any 
civilized  city  in  Europe,  or  the  exercise  of  which,  if 
usurped  by  a  private  individual,  would  be  stopped 
forthwith  ? 

The  charter  for  a  greater  New  York  has  passed 
both  houses  of  the  Legislature,  and  will  undoubt- 
edly soon  become  a  law.  By  this  charter  the  debt 
of  the  city  is  to  be  greatly  increased,  and  the  bur- 
den of  taxation  will  fall  heavily  upon  all  owners  of 
real  estate.  By  the  operation  of  great  natural 
laws,  which  no  human  ingenuity  can  overcome, 
this  increased  burden  of  taxation  must  fall  upon 
those  the  least  able  to  bear  it.  Is  it  not  full  time, 
therefore,  that  the  x>ublic  should  be  aroused  to  ex- 
isting conditions  and  insist  that  those  in  authority 


"^^t^:^-^  <^  aciqs^^^^^ 


it^iiMiMii^ 


M 


40 

shall  refuse  to  give  away  franchises  for  nothing 
which  might  easily  be  made  to  return  a  large  reve- 
nue to  the  city  treasury  ? 

John  Harsen  Rhoades/ 

]^ew  York,  April  14,  1S97. 


Estimated  profit  of  «4.00O,O00  in  Sixth  and  Eiffhth 
avenue  roads. 

The  following  article  in  the  Maf'l  and  Express 
of  the  15th  instant  sets  forth  the  value  of  these 
roads  to  the  city.     The  article  is  : 

"  Sbould  City  Own  ? 


Profit  of  $4,000,000  in   Sixth   and  Eighth  Avenue 

Roads. 


Change  of  Motive  Power. 


Prominent  Railroad  Lawyer  Gives  Some  Figures 
and  Points  Out  How  the  City  Would  Profit 
Largely  by  Securing  These  Franchises. 

The  publication  in  The  Mail  and  Express  on 
Monday  of  a  prominent  railroad  lawyer's  reply  to 
John  D.  Crimmins's  contention  that  the  Act  of 
1874  had  destroyed  the  city's  right  to  bid  in  the 
Eighth  avenue*  road  and  that  a  change  in  the 
ownership  of  the  Sixth  avenue  line  had  worked  a 
like  abrogation  of  the  city's  right  in  the  premises 
has  aroused  a  great  deal  of  interest.  The  prospect 
is  that  out  of  the  sharp  discussion .  which  has  been 
precipitated  by  the  action  of  the  Good  Government 
clubs,  the  Citv  Club  and  the  labor  organizations 
in  demanding  that  the  city  acquire  the  leases  of  the 
roads,  some  decisive  move  will  be  made,  and  that 
the  ciry  will  profit  largely  thereby. 

The  fact  that  Mr.  Crimmins,  in  his  interview  in 
Tlie  Mail  and  Express  last  week,  declared  his  in- 
ability to  understand  how  the  city  could  benefit  by 


41 


acquiring  the  franchises,  has  prompted  William  C. 
Trull,  a  lawyer  of  high  standing  and  a  recognized 
expert  in  railroad  matters,  to  furnish  The  Mail 
and  Express  with  a  statement  to-day  which  has  an 
Important  bearing  upon  the  controversy.  Mr. 
Trull  said  : 

**  You  ask  me  for  the  figures  showing  that  the 
city  could  make  a  profit  on  the  purchase  of  the 
Sixth  and  Eighth  Avenue  Railroad  Companies. 

"  Now,  every  one  knows  that  the  contract  with 
the  city  under  which  these  railroads  are  operated 
provides  that  they  shall  file  with  the  Comptroller 
a  statement,  under  oath,  of  the  cost  of  each  mile  of 
road  completed,  and  that  they  agree  to  surrender 
and  convey  and  transfer  the  said  road  to  the  cor- 
poration of  the  city  of  New  York  whenever  re- 
quired so  to  do  upon  payment  by  the  corporation 
of  the  cost  of  said  road,  as  appears  by  said  state- 
ment, with  ten  per  cent,  advance  thereon. 

PROFIT  OF  $3,000,000. 

*' If  any  one  will  take  the  cost  of  the  roads  as 
shown  by  their  own  report  to  the  State  Board  of 
Railroad  Commissioners  for  the  year  1895,  he  will 
find  that  the  total  cost  of  the  Eighth  avenue  road, 
including  its  real  estate  and  equipment,  is 
$1,661,277.77,  and  that  the  total  cost  of  the  Sixth 
avenue  road  according  to  its  report  for  the  year 
1895,  including  its  real  estate  and  equipment,  is 
$1,778,133.28,  so  that  the  cost  of  either  of  these 
roads  to  the  city  w^ould  not  be  as  much  as 
$2,000,000. 

"The  Eighth  Avenue  Railroad  Company  receives 
from  the  Metropolitan  Street  Railway  Company  a 
net  rental  of  $215,000  a  year,  which  capi  talized  at  four 
per  cent.,  would  represent  more  than  five  millions 
of  dollars.  Here  is  a  clear  profit  on  the  Eighth 
avenue  road  of  $3,000,000. 

*'  Now,  tne  Sixth  Avenue  Railroad  Company  re- 
ceives a  net  rental  from  the  Metropolitan  Street 
Railway  Company  of  $145,000  a  year,  which,  capi- 
talized at  4  per  cent.,  would  represent  more  than 
$3,500,000,  showing  a  clear  profit  to  the  (;ity,  if  it 
took  the  road,  of  $1,500,000.  So  you  see  it  is  clear 
that  under  the  terms  of  the  contract  the  city  could 


i 


% 


: ■—M..: 


i(  t 


42 

acquire  the  roads  of  the  Sixth  and  Eighth  Avenue 

A^A  nnn^   Companies  at  a  profit  of  at  least  $4,- 
000,000.  ' 

*' I  know  that  the  officials  of  the   Metropolitan 
Company  say  that  the  city  ought  not  to  acquire  the 
roads.     Of  course,  they  say  so   because   it   would 
terminate  their  profitable  leases.     The  taxpayers  of 
the  city,  however,  feel   differently.     They  say  the 
city  ought  to  acquire  the  roads  and  so  increase  the 
revenue  of   the   city  and   dimiuish  their  burdens 
When   they  say  this  they  ask   a   very   pertinent 
question,  and  that  is,  which  of  the  members  or  par- 
ties interested  in  the  Metropolitan  Company  would 
hesitate  to  avail  themselves  of  a  privileo-e  in  any 
contract  between  them  and  the  city  by  which  thev 
could  get  a  like  profit  ?  ^. 

City  Should  Own. 

**I  don't  believe,  nor  do  you  believe,  nor  does 
any  one  believe,  that  there  is  a  man  in  the  city  of 
New  York  who  would  wait  a  minute  before  he 
availed  himself  of  the  privilege  the  city  has  if  he 
had  It.  It  IS  no  use  for  any  one  to  say  that  it  is  not 
good  policy  for  the  city  to  own  railroads  The 
Kapid  transit  Act  and  the  new  charter  have  settled 
that  question  by  providing  for  such  ownership  I 
know  that  the  city  officials  seem  indifferent  about 
this  matter,  but  the  why  and  the  wherefore  of  that 
inditterence  no  taxpayer  can  understand 

''Ex-President  Cleveland  said  :  ^  Public  office  is  a 
public  trust.'  If  this  is  so,  the  officials  of  the  city 
having  the  right  to  act,  ought  to  act  at  once;  lust 
as  quickly  lor  the  city  as  if  they  were  to  ffet  the 
profits  themselves.  Yes,  and  quicker,  too,  tbr  thev 
ought,  as  trustees,  to  be  more  jealous  and  careful 
of  the  interests  of  the  public  than  of  their  own 

*•  You  ask  why  there  is  all  this  opposition  to  the 
Metropolitan  Company  changing  its  motive  power 
I  here  is  no  opposition  to  the  change  of  motive 
power.     The  opposition  is  to  such  change  without 
making  compensation  to  the  city. 

No  Pay  for  Privilkges. 

''The  proposed  change  of  motive  power  will  give 
the  Metropolitan  Company  exclusive  occupation  of 


43 


some  1,188,000  square  feet  of  the  public  streets  which 
it  does  not  now  occupy.  When  they  get  that  space 
they  will  have  it  forever.  That  company  guaran- 
tees the  city  for  similar  rights  in  Broaaway  south 
of  Fifteenth  street  $150,000  annually,  which,  capital- 
ized at  4  per  cent.,  represents  more  than  $3,500,000. 
The  company  don't  propose  to  give  a  cent  for  the 
new  space  they  are  trying  to  get,  and  so  it  is  that 
the  taxpayers  complain  and  cry  out.  and  some  pub- 
lic spirited  ones  commence  suits.  They  ask  why  it 
is  that  whenever  they  want  a  cistern  in  the  street 
or  a  vault  in  the  street  they  have  to  pay  $2  per 
square  foot  for  it,  when  the  Metropolitan  Railway 
Company  can  have  1,188,000  square  feet   for  noth- 


ing. 


*'  They  say  that  the  Metropolitan  Company  can 
better  afford  to  pay  $2  a  square  foot  than  they  can, 
for  the  reason  that  the  rights  the  Metropolitan 
Company  get  would  be  forever,  while  all  the^'  get 
is  simply  a  revocable  licence.  They  say  that  if  the 
Metropolitan  Company  should  pay  the  same  as  they 
(the  taxpayers)  have  to  pay,  that  is  $2  a  square 
foot  for  $1,188,000  square  feet,  the  City  Treasury 
would  be  benefited  $2,876,000  and  their  own  bur- 
dens as  taxpayers  would  be  lightened. 

It  is  reported  that  the  Mayor  has  said  thai  he  i» 
not  going  to  take  any  action  in  the  matter  and  that 
the  Corporation  Counsel  says  he  don't  see  how  he 
can.  The  Commissioner  of  Public  Works  grants 
permits  to  use  electricity  on  Eighth  avenue  south 
of  Fifty-first  street,  although  he  knows  that  by  its- 
contract  with  the  city  the  company  has  agreed  not 
to  use  anything  excepting  horse  power  south  of 
that  point,  and  that  if  he  had  insisted  on  their  ob- 
serving their  oontract  they  would  have  to  go  to  the 
city  for  its  consent  and  then  would  have  had  to 
pay  compensation  or  else  not  have  been  released 
from  their  contract." 


4 


€oiniiieiit§  of  a  Citizen. 


In  a  letter  printed  in  The  Sun  on  April  7th,  a 
citizen  gave  his  view  of  the  situation  as  he  be- 
lieved it  existed  at  that  time.     The  letter  is  : 


44 


(» 


SHALL  THE   CITY  BUY  THE  ROADS. 


Reason  Why  the  City  Should  Buy  the  Sixth 
AND  THE  Eighth  Avenue  Surface  Roads^ 
The  Unexplained  Inaction  of  the  Author- 
ities. 

rJ^  ™^  Editor  of  the  SuN-6Yr  ;    In  the  pub- 

lic-spirited  editorial  on  -City  Ownership  of  Street 

tM    ZnH'     Pf  ^^^hed  in  your  paper  on  the  1st  o 

this  month,  after  pointing  our  that  the  city  has  an 

opportunity  of  buying  in  the  Sixth  and  the  Ei 'hth 

avenue  railroads  and   operating  them   at  a   dean 

year  y  profit  of  $318,000,  you   afgue   that  ihe  ci?v 

should  acquire  these  roads,  and  ask  :     -  Why  has 

the  city  for  so   many  years   slept  upon  its  rights 

under  its  contracts    with   these  street  surface  rail 

road  companies,  and   why   have  the  lessees  of  the 

roads  treated  as  nugatory  the  agreement  providing 

for  their  sale  to  the  city  V  ^vium^ 

Permit  me  to  say  that  the  answer  is  not,  as  you 
suggest,  doubt  as  to  the  right  of  the  citv  to  buv 
these  railroads  The  true  answer  is  the  supine  n^  ■ 
difference  of  the  authorities-State  and  city -and 
their  disinclination  to  move  in  this  matter.  Here 
are  the  facts  : 

Six  weeks  ago  the  Metropolitan  Street  Railway 
Company   controlling  and  operating   190  miles  of 

IZl^      T  ril'^?^'  i"i^^«  ^ity,  went  before  the 
State  Board  of  Railroad  Commissior.ers  and  ask«d 
the  board  s  consent  to  the  substitution  of  electricity 
lor  horse  power  on  about  fifty  miles   of  its  roads 
l^or  this  consent,  which   would  practically  amount 
to  the  grant  of  new  franchises   and  would  greatly 
increase  the  value  of  the  rights  of  the  owners  of  the 
lines,  this  railw^ay  company  offered  no  compensa- 
tion ;  nor  did  the  board  suggest  that  any  compen- 
sation be  paid   for  these  valuable  rights      Counsel 
for  organized  labor  supplied  to  the  board  a  list  of 
367  points  in  this  city  where  this  company  per- 
sistently  violates  the  law  by  refusing  to  give  trans - 
ters  over  Its   connecting  owned   and  leased  lines 
and  argued   tliat  the  board  should  not  grant  any 


45 

privileges  to  this  company  until  it  showed  a  willing- 
ness and  intention  to  comply  with  the  law  in  the 
matter  of  transfers.  To  this  argnment  the  board 
paid  little  attention.  While  it  is  true  that  the 
Board  of  Railroad  Commissioners  is  limited  in  its 
power  of  couplins;  conditions  with  its  consent  to  a 
change  of  motive  power,  it  would  seem  to  have 
been  most  natural  for  the  board  to  have  given  this 
company  to  understand  that  new  privileges  would 
not  be  granted,  gratis,  to  a  company  oersistently 
derelict  in  its  duty  to  the  travelling  public. 

This  board  is  char^^ed  with  supervisory  powers 
over  the  railroads  of  the  State.  It  cannot  grant  its 
consent  to  a  change  of  motive  power,  but  it  can 
withhold  such  consent.  Would  the  owner  of 
private  property,  who  had  granted  for  a  small  con- 
sideration valuable  rights  in  his  property,  extend 
any  new  privileges  to  its  grantee,  if  it  violated  its 
duty,  not  only  to  the  grantor,  but  also  to  weaker 
persons,  as  to  whom  the  grantor  stood  in  the  capa- 
city of  a  guardian^  Within  three  days  after  the- 
hearings  of  these  applications  were  closed  the 
board  granted  its  consent  to  the  use  of  these  new 
franchises. 

Again,  at  these  hearings  counsel  for  a  rival  street 
railway  corporation,  acting,  doubtless,  in  self-in- 
terest, showed  to  this  board  that,  as  you  say  in  your 
editorial,  by  the  terms  of  the  original  grants  to  the 
Sixth  and  the  Eighth  avenue  railroad  companies^ 
whose  roads  the  Metropolitan  Street  Railway  Com- 
pany leases  at  yearly  rentals  of  $145,000  and  $215,- 
UOO  respectively,  the  city  could  buy  in  these  roads 
at  only  10  per  cent,  advance  on  tlieir  cost  of  con- 
struction. Counsel  urged  that  the  transformation 
of  these  two  roads  into  electric  roads  would  greatly 
increase  their  value ;  that  this  transformation 
would  probably  be  made  the  occasion  for  increas- 
ing the  bonded  indebtedness  of  these  two  lines  ; 
that  electrical  equipment  and  bonding  these 
roads  would  make  their  ''  cost  of  construction  " 
far  greater  than  the  original  cost  of  construction^ 
and  that,  should  the  city  see  tit  to  buy  these  roads 
as  they  stand  to-day,  inexpensive  but  exceed- 
ingly valuable  horse-car  lines,  it  could  get  them, 
at  a  good  bargain.     It  would   be  obliged  to  pav 


>>      ■"'W^  ■  - '--^W-  "J^'^m^'!^^^, 


m 


46 

nincli   more  after  their  transformation,  and   hence 
counsel   urged    that   these  new  i)rivileges  should 
not     be     granted     as    to     the     Sixth    and     the 
Eighth  avenue  lines.     To  this  argument,  also,  the 
board  paid  little  or   no  attention.     Without  condi- 
tions, save  general   ones  as  to  compliance  with  the 
laws  and   conditions   as   to   speed,  did  this  board 
grant  to  a  company,  which  already  controls  nearly 
<^very  mile   of   street   surface  railroad  in  this  city, 
the  further  franchise   of  constructing  electric  rail- 
roads over  nearly  fifty  miles  of  the  city's  streets.    To 
be  sure,  the  consent  of  this  board  is  not  a  complete 
grant  to    this   company   of   the  right  to  construct 
such  roads.     The   permits   of  several  local  author- 
ities, namely,  the  Commissioner  of  Public  Works, 
the  Common   Council,    the  Park  Department,  and 
the  Board  of  Electrical  Control,  must  also  be  secured 
before  such  valuable  rights  can  be  obtained  without 
•compensation   by  a  private  corporation.     But  this 
board  said  in  efllect  :   ''  So  far  as  we  are  concerned 
you  can  have  these  franchises  for  nothing." 

The  next  step   toward  securing  these  new  fran- 
chises was  an  application  made  some  ten  days  ago 
by  the   company    to   the   Commissioner  of   Public 
Works  for   his  permission   for  the  construction  of 
these  new  and  improved  roads.     Able  counsel,  ap- 
pearing for   the  Metropolitan  Street  Railway  Com- 
pany, asked  this  custodian  of  the  city's  interest  in 
the   public   streets   for  his  permission  to  excavate 
therein.     In  form  it  was  an  application  for  permis- 
sion to  dig  up  the  streets.     In  reality  it  was  a  bold- 
faced request  by  this  applicant  for  new  franchises  in 
fifty  miles  of  streets— franchises  asked  for  and  ex- 
pected  to   be   acquired  without  the  payment  of  a 
<;ent,  comparatively  speaking.  Here,  again,  counsel 
<'alled   the  attention   of  the   Commissioner  to  the 
present  great  value   and  the  enhanced  future  value 
of  tiiese  lines  of  road,  and  laid  before  the  Commis- 
sioner the   facts   stated  to  the  Board  of  Railroad 
Commissioners,  namely,  that  the  permission  should 
not  be  granted  as  regards  the  Sixth  and  the  Eio-luh 
avenue  lines,  in   view   of   the  fact   that  these  fran- 
chises could  be  acquired  at  so  great  a  profit  to  the 
«ity. 

The  attitude  of  the  Commissioner  thus  far  in  this 


47 


matter  is  surprising.  The  press  quotes  him  as  say- 
ing that  he  did  not  see  how  any  action  of  his  could 
estop  the  city  from  asserting  whatever  rights  it  may 
have  in  the*^matter  of  acquiring  these  franchises, 
and  that  the  city's  interest  would  not  be  prejudiced 
by  his  granting  his  consent.  It  is  true,  the  condi- 
tions which  the  Commissioner  can  couple  with  his 
pernjit  are  few,  but  need  he  surrender  so  weakly  ? 
It  seems  hardly  possible  that  the  sober  second  judg- 
ment of  the  Commissioner  and  of  the  able  Deputy 
Commissioner  can  allow  them  to  grant  their  con- 
sents before  the  citizens  have  had  a  second  chance 
to  be  heard  in  this  matter. 

In  striking  contrast  to  this  mysterious  indiffer- 
ence of  the  Railroad  Commissioners  and  the  Com- 
missioner of  Public  Works  is  the  action  of  the 
Board  of  Aldermen,  which  appears  next  in  this 
play  of  the  railway  company  for  these  valuable 
franchises.  The  Board  of  Aldermen,  by  its  rail- 
road committee,  learning  of  the  city's  rights  in  the 
Sixth  and  the  Eighth  avenue  railroads,  and  alive  to 
the  city's  interest  therein,  have  informed  the  Com- 
missioner of  Public  Works  of  the  facts  in  the  case 
and  have  requested  him  to  delay  action  pending  an 
investigation  of  the  advisability  of  the  city  acquiring 
these  roads.  This  report  is  expected  daily,  and  it 
seems  hardly  possible  that  a  second  local  authority 
can  give  its  consent  while  the  city  fathers  are  in- 
vestigating with  a  view  to  buying  the  property. 

Then  comes  the  Third  Avenue  Railroad  Company 
and  offers  in  writing,  first,  to  buy  these  two  roads 
from  the  city  and  pay  therefor  the  cost  of  construc- 
tion and  $1,000,000  cash  in  advance  thereon  ;  and, 
second,  to  lease  these  two  roads  at  a  yearly  rental 
of  ten  per  cent,  on  that  price,  besides  live  per  cent, 
of  the  gross  receipts. 

Then  comes  the  Corporation  Counsel.  Instead  of 
suggesting  ways  by  which  the  city  can  secure  these 
franchises',  keen  lawyer  that  he  is,  he  fairly  bristles 
with  objections.  The  reason  why  the  city  cannot 
buy  these  two  roads,  the  Cor[)orati3n  Counsel  says, 
is  that  it  has  not  the  money  and  has  no  way  of  get- 
ting it.  In  answer  to  it  comes  the  statement  in 
your  issue  of  the  3d  instant,  that  a  bill  is  even  now 
being  prepared  authorizing  the  city  to   raise  the 


<•■  a 


M 


48 

funds  necessary.    Fnrtlier.  even   if  the  city  could 
raise   the   money  ti.e  Corporation   Counsel  says  it 
c^n  buy  them,  no   n.atter  what  change  comes  over 
the  lines      True,  but  the  city  at   the  present  time, 
betore   the  enormous   cost  of  electrical  equipment 
has  been   added,  ran  buy   these  properties,  worth 
as   you  say,  $7,0()(),()0a  for  about  $],400,0()().     But 
If  the  city  waits  until  after  the  Metropolitan  Street 
Kailway  Company  is  allowed  to  burden  these  roads 
with  costly  improvements,  encrjneered  by  itself,  and 
with  heavy  bond  issues  to  meet  the  cost  of  the  im- 
provements, then   the  city  will  be  obliged  to  buy 
the   roads  at  a   much   higlier  cost  and  at  a  corre- 
spondingly decreased  profit  to  itself. 

This  is  not  a  time  for  discovering  difficulties,  but 
rather  of  seeing  how  the  rights  and  interests  of  the 
municipality  and  of  the  citizens  can  best  be  con- 
served ;  how  best  the  benefit  of  these  valuable 
franchises  can  be  obtained  by  the  city  for  the  bene- 
fit of  the  citizens.  As  you  well  sav,  if  only  bv 
leasing  out  thesp  roads  the  citv  can  m^ake  a  yearly 
proht  otm8,m),  why  should  not  such  revenue 
be  turned  into  the  treasury? 

What  the  city  can  and  should  get  from  the  sale 
or  Its  franchises  is  seen  in  the  recent  sale  of  the 
Aingsbridge  extension  to  the  Third  Avenue  Rail- 
road  Company.     This  franchise  was   sold  to  this 
latter  company  on  condition  that  it  pay  therefor 
some  thirty-eight  per  cent,  of  its  gross  earnings. 
:^or   the  privilege  of  putting  in  a  cable  system  on 
Broadway    for    the    short    stretch    of   rokd    from 
Union  Square   to    the   Battery  this    Metropolitan 
fetreet  Railway   Company  was   willing  to    pay  to 
the  city  the   sum   of  $150,000  annually-a   small 
iraction,  indeed,  of  its  net  earnings.     Further   this 
company    is     not    asking    for     a    mere    cliange 
ot  motive  power,  for   in    the   original  grants    to 
tiiese  tvvo  companies  it  was  expressly  agreed  that 
below   Forty-second    and    Fifty-first     streets    re- 
spectively they  should  have  the  right  to  operate 
their    cars    by   no  power    except     horse     power. 
iJierelore  they  are  asking  not  for  a  change,  but 
lor  an  absolutely  new  franchise,  namely,   a   fran- 
chise for  electric  roads.      There  can  be  no  doubt 
tliat   If   these    franchises    were    sold   at   auction 


49 


as  the  law  now  prescribes  that  all  franchises 
must  be  sold,  handsome  bids  would  be 
made  for  these  privileges.  And  this  company 
asks  these  rights  for  nothing.  Is  it  not  time  for 
the  city  to  bestir  itself  to  save  what  it  can  of  the 
revenues  to  be  derived  from  its  railroad  fran- 
chises? Now  is  the  time  to  act  before  the  chance 
is  gone. 

*'ClTIZEX." 

Reply  of  the  Railroad  €oiiiiiiig§ioii. 

To  "Citizen's"  letter,  insofar  as  it  related  to 
the  Railroad  Commission,  the  following  reply  was 
made  in  the  Su?i  on  the  day  following.  The  reply 
is: 

THE    CITY    AXD    STREET    RAILROADI^. 


At^^  Explanation  from  the  Chairman  of  the 

State  Railroad  Com3iission. 
To  the  Editor  of  the  Sun  : 

Sir — An  individual  .who  j)refers    to  hide    his 
identity   under   the  signature  of   "Citizen"    airs 
himself  somewhat  gaudily  in  the  Sicn  of  to-day  in 
a  communication  occupying  a  full  column  of  your 
editorial  page,  under  the  title,  "  Shall  the  City  Buy 
the  Roads?"     It  is   not   my  purpose  to   occupy 
your  valuable  space,  nor  would   it  be  proper   for 
me,  as  a  State  officer,  to  enter  into  the   bitter  con- 
troversy between  the  Metropolitan   Traction  Com- 
pany and  the  Third  Avenue   Railroad  Company, 
involving  the  right  to  buy,  seize,  own  and  operate 
surface  railways  in  the  city  of  New  York.     It  is  a 
struggle  in  which  millionaires  are  arrayed  against 
millionaires    in    gigantic  warfare  for  the    posses- 
sion of  franchises  worth  millions  of   dollars,  and 
from  which  it  is  to    be   hoped   great   benefits   in 
the  form  of  rapid    transit  facilities   may    be    de- 
rived for   the   metropolis.     Certainly   there  is  no 
greater  problem,  no  greater  need,  now  before   the 
people  of  this  great  city. 


M 


M 


li 


50 

I  take  no  risk,  however,  in  asserting  that  ''  Citi- 
zen "    is  either   grossly   ignorant  or  wilFully  un- 
truthful and  malevolent  in  seeking  anonymously 
to  asperse  the  State  Railroad  Commission  for  its 
action  in  granting  permission  to  the  Metropolitan 
Traction  Company  to  change  the  motive   power  on 
the  Sixth,  Eighth  and  Ninth  avenue  and  the  Fifty- 
ninth  street  surface  railroads.     It  never   has  been 
within  the  jurisdiction  of  the  Railroad  Commission 
to  sell  franchises  for  the  construction  of  railroads, 
either  in  cities    or   other   portions   of   the    State, 
nor  is  it  the  business  or  the  function  of  the  board 
to    make   recommendations   to    municipalities    on 
the  subject  of  the   prices  at  which  thev   shall   sell 
francliises.     Such  matters  are  all  provided  for  by 
existing  laws.     If   ^'Citizen"  was  ignorant  of  this 
fact,  he  was  presumptuous   in   parading  that   ig- 
norance, and  if  he  knew  it,  but  nevertheless  sought 
in  his  covert  way  to  impugn  the  action  of  the  Rail- 
road Commission,  his   position   is   only   the   more 
contemptible.     I  do  not  believe  ignorance  to  be  his 
greatest  fault.     Regarding  his  puerile  fling  at   the 
prompt  action  of  the  Commission  in   granting  the 
permits,  it  is  x)erhaps  sufficient  to  say  to  the  people 
of  New  York  city  that   the   Railroad   Commission 
believes  that  they  urgently. need  improved  and  ex- 
tended rapid  transit  facilities,  and   that  the  only 
officer   of   the  municipality  who  appeared   before 
the   board  during  the  several   days    occupied   in 
hearing  the  application  was   the   Commissioner  of 
Public  Works,  who  officially  urged  prompt  action 
by  the  board,  whatever  its  decision  might  be.    And 
the  >S'^^7i,  which  not  only    ''shines  for  all,"    but  al- 
ways strives  to  be  the  fair  representative  of  public 
opinion,  urged  in  one  of  its  brief  but  vigorous  edi- 
torial paragraphs    that   the   Railroad   Commission 
should  not  merely  act  promptly  on  the  application, 
but  that  it  should  act  favorably  thereon. 

The  only  question  before  the  board,  or  of  which 
it  had  jurisdiction  on  the  application,  was  that  re- 
lating to  the  system  of  motive  power.  The  board 
has  no  power  to  determine  questions  of  legal 
right— these  are  expressly  reserved  to  the  courts 
of  law.  Regarding  the  alleged  failure  of  the 
Metropolitan    Traction    Company  to  give  transfer 


' 


61 


facilities  at  all  proper  transfer  points  on  its  lines, 
that  question  had  no  relation  to  the  case  before 
the  Board,  but  is  the  subject  of  a  separate  charge, 
and  will  be  heard  and  determined  by  the  board  at 
an  early  date. 

So  far  as  the  right  of  the  city  to  recover  the 
charters  of  the  Sixth  and  Eighth  avenue  roads  is 
concerned,  the  right,  if  it  exists,  is  not  in  the  least 
hampered  or  impaired  by  any  action  of  the  Rail- 
road Commission.  The  city  may  begin  its  action 
to  recover  these  franchises  within  twenty-four 
hours  and  before  work  is  begun  by  the  traction 
company  ;  it  could  have  begun  suit  for  that  pur- 
pose at  any  time  for  forty  years  past,  or  within  the 
past  few  weeks  during  which  this  subject  has  been 
fretting  ''  Citizen."  Finally,  the  subject  is  one 
well  worthy  of  the  manly  thought  and  effort  of 
every  public-spirited  citizen,  a  fair  guerdon  for 
battle  in  the  open.  No  man  should  be  content  to 
be  a  bushwhacker  in  such  a  cause,  or  write  on  the 
question  under  a  pseudonym, 

Very  truly  yours, 

Ashley  W.  Cole, 
Chairman  of  the  Railroad  Commission. 

New  York,  April  7. 


t3 


\m 


Tlie  Position  of  the  Metropolitan  Company. 


The  following  interview  with  John  D.  Crimmins 
printed  in  the  Mail  and  Express  on  the  9tli  instant 
defines  the  attitude  of  the  Metropolitan  Company. 
The  interview  is  : 

*'  After  a  conference  with  Mayor  Strong  to  day 
John  D.  Crimmins,  who  is  recognized  as  the  ruling 
local  spirit  in  the  Metropolitan  Street  Railway 
Company,  announced  that  under  an  act  of  the 
legislature  passed  in  1874  the  city  lost  whatever 
right  it  had  in  the  franchise  of  the  Eighth  avenue 
road.  So  far  as  the  Sixth  avenue  line  is  con- 
cerned, Mr.  Crimmins  added,  it  was  his  conviction 
that  the  citv  had  lost  its  right  to  buv  in  that  road. 
He  said  that  he  was  anxious  to  have  the  whole 


'^■'~"^^*«^^'-^^^  - 


fl 


52 

matter  fought  out  in  the  Courts  and  settled  for  all 
time. 

*/My  interest  in  property  in  this  city,"  said  Mr. 
Crimmins  to  a  Mall  and  Express  reporter,  *'is 
much  greater  than  my  interest  in  railroads.  I  have 
the  welfare  of  the  city  at  heart.  Anything  which 
tends  to  enhance  the  financial  standing  of  the  city 
appeals  to  me.  For  that  reason  I  think  I  can  talk 
on  this  railroad  matter  without  being  accused  of 
selhsii  motives. 

For  no   Public    Good. 


u 


The  proposition   has  been  made  that  the  city 
buy   the   Eighth  and  Sixth  avenue  roads.     Now, 
how   could  such  purchase  benefit  the  people?    If 
the   Sixth  avenue   road   were  purchased,  it  would 
form    a   line   only   from   the   Park,  south.     There 
could   be   no    transfers,  because  only  roads   under 
one  management  issue  transfers.     The  same  can  be 
said   of  the   Eighth  avenue  line.     As  they  are  run 
to-day,  the  public  get  a  maximum  of  accommoda- 
tion at  a  minimum  cost.     Why,   when  you  take 
our  transfers  into  consideration  the  average  cost  of 
a  fare  on  our  lines  is  only  a  little  more  than  three 
cents. 

''The  Metropolitan  Street  Railway  Company 
does  not  own  the  Sixth  and  Eighth  avenue  roads 
We  simply  lease  them.  The  Metropolitan  Com- 
pany does  not  own  a  share  of  stock  in  the  Sixth 
avenue  line.  These  roads  are  owned  by  the  stock- 
holders of  the  companies  which  had  been  operating 
them.  Nothing  could  be  gained  by  the  public  if 
the  city  should  take  possession  of  the  roads.  In 
fact,  the  city  and  the  public  would  be  the  losers 
thereby. 

''I  believe  that  attention  has  never  been  called 
to  the  fact  that  by  an  act  of  the  legislature  of 
1874,  the  city  lost  the  right  to  buy  the  Eighth 
avenue  road.  Look  up  that  law.  It  provided  for 
an  extension  of  the  road  to  the  Maccomb's  dam 
bridge,  and  placed  the  corporation  under  the 
general  railway  act,  at  the  same  time  I'epealing  all 
inconsistent  acts." 

"lam  satisfied,"  continued  Mr.  Crimmins,  '^that 
this  act  will  be  construed  by  the  Courts  as  meaning 


53 


that  the  city  lost  its  right  to  buy  in  the  charter. 
You  will  observe  that  the  act  placed  the  Eighth 
Avenue  Company  under  the  general  law  relating  to 
railroads,  and  that  the  third  section  repealed  all 
acts  in  contravention  of  this  one. 


1 


The  Sixth  Avenue. 

"  The  case  with  the  Sixth  avenue  road  is  different, 
but  I  am  convinced  that  the  Courts  will  hold  that  the  , 
city  has  no  claim  upon  that  either.  The  Sixth 
avenue  road  was  constructed  by  a  number  of 
capitalists  under  an  agreement  with  the  city. 
The  city  w^as  to  have  an  option  on  the 
road.  But  the  city  never  took  advantage 
of  the  option.  Later  the  road  passed  out 
of  the  hands  of  its  builders  into  those 
of  another  company.  Now,  if  I  give  a  man  an 
option  on  a  piece  of  property,  and  if  he  fails  to 
take  advantage  of  the  option,  can  he  claim  the 
property  from  another  man  to  whom  I  have  sold  it  ? 

"  Whatever  the  merits  of  the  case  may  be  I  would 
like  to  see  the  whole  matter  fought  out  in  the 
Courts.     Let  us  have  a  final  settlement. 

The  eity's  options  on  the  Sixth  and  Eig^hth  avenue 
roads  are  still  In  force. 

A  complete  reply  to  the  Metropolitan's  conten- 
tion that  the  Sixth  and  Eighth  avenue  options  are 
now  void  appeared  in  the  Mail  and  Express  on 
the  following  day,  the  10th  instant.  This  article 
is  as  follows  : 

''  A  railroad  lawyer  who  read  the  statement  of 
Mr.  John  D.  Crimmins,  printed  exclusively  in  The ' 
Mail  and  Express  of  Friday  evening,  to  the  effect 
that  an  old  law  passed  by  the  Legislature  of  1874 
deprived  the  city  of  its  right  to  buy  in  the  Eighth 
avenue  surface  railroad,  said  he  didn't  agree  with 
Mr.  Crimmins.  ''I  was  interested,"  said  he,  ''in 
Mr.  Crimmins' s  statement  that  he  believed  the  at- 
tention of  the  public  had  never  been  called  to  this 
law  of  1874.  I  examined  the  authorities,  and, 
curiously  enough,  found  that  the  Court  of  Appeals 
had,  in  an  action  brought   by  the   Mayor  against 


54 


t 


il 


il 


this  very  Eighth   Avenue   Railroad   Company,  de- 
cided Mr.  Crimmins's  point  against  him. 

''  This  Eighth  avenue  road,  I  find,  was  incorpor- 
ated away  back  in  the  early  50' s,  and  when  it  got 
its  rights  it  agreed  to  pay  a  license  fee  of  fifty  dollars 
a  year  for  each  car.  The  company  paid  these 
fees  up  to  the  year  1874.  Then  this  law  that  Mr. 
Crimmins  refers  to  was  enacted.  As  Mr.  Crim- 
mins  correctly  stated,  this  law  placed  the  railroad 
company  under  the  general  railroad  act,  and  at  the 
same  time  repealed  all  inconsistent  acts.  Perhaps 
Mr.  Crimmins  can  explain  why  it  was  neces- 
sary to  place  the  Eighth  Avenue  Company  under 
the  general  railroad  act  when  it  was  incorporated 
under  that  act,  and  so,  of  necessity,  must  have 
been  subject  to  its  provisions.  He  may  do  this.  I 
cannot. 

The  City'i  Suit. 

*'  After  the  passage  of  this  act  the  railroad  com- 
pany claimed  that  by  being  placed  under  the  rail- 
road law  and  by  the  repeal  of  all  inconsistent  acts 
it  was  relieved  from  the  obligation  to  pay  the 
license  fees.  Consequently  it  refused  to  pay  them. 
Then  the  city  sued  the  company. 

"  This  case  reached  the  Supreme  Court  ten 
years  ago,  and  that  Court  decided  that-  the  act  of 
1874,  which  Mr.  Crimmins  thought  he  uncovered, 
did  not  relieve  the  road  from  its  contract  with  the 
city,  and  that  it  had  to  pay  license  fees  just  the 
same.  The  Court  said  that  if  this  act  had  been  in- 
tended ro  let  the  road  off  from  its  contract  the  law 
would  have  been  unconstitutional,  because  the 
Legislature  could  not  impair  the  contract  with  the 
city. 

''  Of  course  the  compau}^  appealed,  and  three 
years  later,  1890,  the  Court  of  Appeals  affirmed  the 
decision  of  the  Supreme  Court  and  said  just  as 
emphatically  as  did  the  lower  Court  that  the  con- 
tract with  the  city  was  still  binding  in  sx)ite  of  the 
law  of  1874. 

"  Wlien  the  company  got  this  franchise  from 
the  city  it  agreed  to  sell  its  road  to  the  city  when- 
ever the  city  should  want  to  buy  it.  Now,  the 
agreement  to  sell  its  road  whenever  the  city  wanted 


-ifl 


55 


to  buy  it  is  just  as  much  a  contract  as  the  agree- 
ment of  the  company  to  pay  a  license  fee  of  fifty 
dollars  for  each  car.  They  are  both  contracts,  and 
the  Legislature  could  not  by  any  act  break  the 
contract  with  the  city.  So  you  see  that  the  city 
has  got  just  as  good  right  to  buy  the  road  now  as 
though  this  act  of  1874  had  never  been  passed. 

"And  the  chances  are  very  good  that  Mr.  Crim- 
mins's desire,  expressed  in  the  Mail  and  Express^ 
to  have  this  whole  matter  fought  out  in  the  Courts 
will  be  gratified." 


The  Sixth  Avenue. 

When  The  Mail  and  Express  man  asked  the 
lawyer  what  he  thought  of  Mr.  Crimmins's  argu- 
ment that  the  city  had  lost  its  option  to  buy  in  the 
Sixth  avenue  road  because  that  road  had  been  sold 
by  the  original  owners  who  made  the  contract  with 
the  city,  the  lawyer  said  he  didn't  believe  that 
would  stand  any  better  than  the  argument  as  to 
the  Eighth  avenue  road. 

''  You  see,"  said  he,  "  when  the  promoters  of 
the  Sixth  avenue  road  got  their  franchise  they 
agreed  to  sell  the  road  to  the  city  at  any  time. 
That  was  a  condition  imposed  upon  the  company. 
Whoever  bought  the  road  necessarily  bought  it 
condition  and  all.  The  owners,  by  selling  the 
road,  could  not  deprive  the  city  of  its  chance  to 
buy.  The  condition  to  sell  traveled  right  along 
with  the  franchise  all  the  time  and  is  good  to-day. 
I  see  Mr.  Crimmins  says  he  does  not  see  what 
good  the  public  would  get  by  building  this  road. 
It  seems  to  me  that  the  fact  that  another  railroad 
company  offered  the  city  $1,000,000  for  its  option 
on  the  two  roads,  and  that  Mr.  H.  J.  Braker 
raised  this  otter  to  $2,000,000  for  both  franchises, 
is  pretty  good  evidence  that  the  city  could  get 
something  out  of  them  by  buying  the  roads  and 
selling  them.  If  any  one  will  give  the  city 
$2,000,000  of  property  for  the  privilege  of  baying 
these  roads  there  certainly  must  be  something  in 
it  for  the  city  to  sell  them." 


REFORM  CLUB. 

Committed  on 

MUNICIPAL  ADMlNISTt^AnON. 


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